acct chapter 1 practice questions

acct chapter 1 practice questions - Chapter 1 Practice...

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Chapter 1 Practice Questions Multiple Choice Identify the choice that best completes the statement or answers the question. 1. A business started the current period with liabilities of $71,000 and Equity of $37,000. During the period the following business transactions took place. 1. Purchased equipment for $43,000; paying $17,000 cash and issuing a note payable for the balance. 2. Received $2,700 of the amount owed by a customer for services provided on account. 3. Paid $5,700 of the amount owed for supplies purchased on account. 4. Provided services of $3,500 on account. 5. Paid $1,900 towards rent for the current period. Determine the Assets of the business at the end of the period. a. $146,100 b. $120,100 c. $55,900 d. $129,900 2. A company prepares four basic financial statements: 1.Balance Sheet 2. Statement of Cash Flows 3. Statement of Retained Earnings 4. Income Statement. These are prepared in the following order a. 4,1,2,3 b. 4,3,1,2 c. 1,4,3,2 d. 1,3,4,2 3. Since the accounting equation must remain in balance after each transaction, a transaction that causes an increase in an asset, may also cause a. An increase in a liability b. An increase in another asset c. A decrease in owner’s equity d. A decrease in a liability 4. An example of resources owned by a company is a. Accounts Payable b. Accounts Receivable
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c. Common Stock d. Retained Earnings 5. Determine Net Income, if a corporation had total assets of $600,000 and total equity of $225,000 at the beginning of the year, and assets increased by $150,000 and liabilities increased by $60,000, and no oth- er transactions occurred except a dividend payment of $45,000 and revenues and expenses. a. $135,000 b. $45,000 c. $90,000 d. $105,000 6. On October 1, 2008, the Vice President for Sales of a manufacturing business entered into a contract with a merchandising company to sell 50,000 cases of their product to the merchandising company at a price of $1,500,000. The product is delivered to the merchandising company in June , 2009. The accounting
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This note was uploaded on 03/22/2010 for the course ACCT 2010 taught by Professor Bahn during the Spring '10 term at UGA.

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acct chapter 1 practice questions - Chapter 1 Practice...

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