SampleMidterm1

SampleMidterm1 - Exam 1 1 Accounting is an information and...

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Exam 1 1. Accounting is an information and measurement system that: Identifies business activities. Records business activities. Communicates business activities. Helps people make better decisions. All of the above. 2. The accounting guideline prescribing that financial statement information be supported by independent, unbiased evidence other than someone's belief or opinion is the: Business entity principle. Monetary unit principle. Going-concern principle. Cost principle. Objectivity principle. 3. A parcel ofland is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by its purchasers as being worth $140,000, and is purchased for $137,000. The land should be recorded in the urchaser's books at: $ 95,000. $137,000. $138,500. $140,000. $150,000.
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4. Revenue is properly recognized: When the customer's order is received. Only if the transaction creates an account receivable. At the end of the accounting period. Upon completion of the sale or when services have been performed and the business obtains the right to tO/I(d:. .t lect the sales price. When cash from a sale is received. 5. An example of an operating activity is: Paying wages. Purchasing office equipment. Borrowing money from a bank. Selling stock. Paying off a loan. "id,_.,;.,+., ,6:i."An example of an investing activity is: Paying wages of employees. Paying dividends. Purchasing land. Selling inventory. Contribution from owner. '!i\'1f equity is $300,000 and liabilities are $192,000, then assets equal: $108,000. $192,000. $300,000. $492,000. $792,000.
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he same as net income. he excess of expenses over assets. Resources owned or controlled by a company Increases in retained earnings from a company's earning activities. The costs of assets or services used. 9. The distribution of assets to stockholders is called a(n): Liability. Dividend. Expense. Contribution. Investment. i O. Viscount Company collected $42,000 cash on its accounts receivable. The effects of this transaction as eflected in the accounting equation are: Total assets decrease and equity increases. Both total assets and total liabilities decrease. Total assets, total liabilities, and equity are unchanged. Both total assets and equity are unchanged and liabilities increase. Total assets increase and equity decreases. 11. Unearned revenues are: Revenues that have been earned and received in cash. Revenues that have been earned but not yet collected in cash. Liabilities created when a customer pays in advance for products or services before the revenue is earned. Recorded as an asset in the accounting records.
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This note was uploaded on 03/18/2010 for the course MGT 11A taught by Professor Armstrong during the Spring '08 term at UC Davis.

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SampleMidterm1 - Exam 1 1 Accounting is an information and...

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