pre test 1.docx - Question 1 0.2 out of 0.2 points Paying a cash dividend to shareholders is a(n Selected Answer financing activity Answers operating

pre test 1.docx - Question 1 0.2 out of 0.2 points Paying a...

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Question 1 0.2 out of 0.2 points Paying a cash dividend to shareholders is a(n) ______. Selected Answer: financing activity Answers: operating activity investing activity financing activity expense Response Feedback: See Module 1 LO 3 and LO 6.3. Operating Activities: involve collecting from customers and paying operating expenses; Investing Activities: involve purchasing/selling long-term assets and investments in marketable securities (investments in stocks and bonds of other companies); and Financing Activities: involve borrowing/repaying creditors and any transactions with the shareholders (stocks and dividends). Question 2 0.2 out of 0.2 points Match each item below with the appropriate description using each one only once. Question Correct Match Selected Match Income Statement B. Reports a summary of all revenues minus all expenses during a period B. Reports a summary of all revenues minus all expenses during a period Statement of Shareholders' Equity C. Reports the changes that took place in the amount of the owners' investment during a period C. Reports the changes that took place in the amount of the owners' investment during a period Statement of Cash Flows D. Reports a summary of cash collected and cash paid during a period D. Reports a summary of cash collected and cash paid during a period
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Balance Sheet E. Reports the assets, liabilities and shareholders' equity of a company at a specific point in time E. Reports the assets, liabilities and shareholders' equity of a company at a specific point in time Notes (or footnotes) A. Reports additional information needed to better understand the financial statements A. Reports additional information needed to better understand the financial statements All Answer Choices A. Reports additional information needed to better understand the financial statements B. Reports a summary of all revenues minus all expenses during a period C. Reports the changes that took place in the amount of the owners' investment during a period D. Reports a summary of cash collected and cash paid during a period E. Reports the assets, liabilities and shareholders' equity of a company at a specific point in time Response Feedback: See Module 1 LO 4.1 FS Purposes. The four financial statements and notes to the financial statements that are required annually are: Income Statement - reports the results of the company’s operations during the year; Statement of Shareholders’ Equity - reports the changes in the owners’ investment in the company (instead of a statement of shareholders’ equity, some companies will include a statement of retained earnings) during the year; Statement of Cash Flows - reports the change in the company’s cash during the year; Balance Sheet - reports the company’s economic resources (assets), obligations (liabilities), and owners’ equity (shareholders’ equity) at a point in time (the end of the year); and Notes (or footnotes) to the financial statements - provide other information needed to help external users better understand the information in the financial statements.
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