AIS 100 Ch 1-5 Rev Qs

AIS 100 Ch 1-5 Rev Qs - 1. Which of the following reports...

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1. Which of the following reports the success or failure of the company’s operations for a period of time? a. Balance Sheet b. Statement of Cash Flows c. Income Statement d. Net Income Statement 2. _______ is the increase in assets resulting from the sale of a product or service in the normal course of business. a. Expense b. Liability c. Retained Earnings d. Revenue 3. Every U.S. Company that is publicly traded must provide this to their shareholders. a. Auditor’s Report b. Annual Report c. CPA Report d. Dividends 4. Which of the following is not an advantage of the corporate form of business organization? a. No personal liability b. Easy to transfer ownership c. Favorable tax treatment d. Easy to raise funds 5. A corporation has which of the following set of characteristics. a. Shared control, tax advantages, increased skills and resources b. Simple to set up and maintains control with founder c. Easier to transfer ownership and raise funds, no personal liability d. Harder to raise funds and gives owner control 6. Which of the following is not a principal type of business activity? a. Operating b. Investing c. Delivering d. Financing 7. Which of the following statements concerning uses of accounting information is incorrect ? a. Management is considered an internal user b. Present creditors are considered external users c. Regulatory authorities are considered internal users d. Taxing authorities are considered external users
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8. If the retained earnings account increases from the beginning of the year to the end of the year, then a. Net income is less than dividends b. A net loss is less than dividends c. Additional investments are less than net losses d. Net income is greater than dividends 9. If total liabilities decreased by $15,000 and stockholders’ equity increased by $5,000 during a period of time, then total assets must change by what amount and direction during the same period? a. $20,000 increase b. $10,000 decrease c. $10,000 increase d. $15,000 decrease e. None of the above 10. Congress passed this act to try and reduce unethical corporate behavior and consequently decrease the likelihood of future corporate scandals. a. Sarbanes-Oxley Act b. Fair Trade Act c. Patriot Act d. The Glass Steagall Act 11. The going concern assumption is inappropriate when a. The business is just starting up b. Liquidation appears likely c. Market values are higher than costs d. The business is organized as a proprietorship 12. The cost principle requires that when assets are acquired, they be recorded at a. Market value b. The amount paid for them c. Selling price d. List price 13. Many companies have assets that do not have physical substance yet often are very valuable. They are considered a. Current assets b. Property, plant and equipment c. Intangible Assets d. All of the above
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14. Adherence to the procedure of choosing the accounting method that will be least likely to overstate assets and income is an example of the constraint of a. Relevance
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AIS 100 Ch 1-5 Rev Qs - 1. Which of the following reports...

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