misc1-4 - Dr. Ron Grambo ACC253 Study Questions (random)...

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Dr. Ron Grambo ACC253 Study Questions (random) Name _________________________ 1. Two primary external users of accounting information are investors and creditors. 2. The monetary unit assumption states that transactions that can be measured in terms of money should be recorded in the accounting records. 3. Operating activities involve putting the resources of the business into action to generate a profit. 4. Corporate stockholders generally pay higher taxes but have no personal liability. 5. Net income for the period is determined by subtracting total expenses and dividends from revenues. 6. External users of accounting information are managers who plan, organize, and run a business. 7. Investing activities involve collecting the necessary funds to support the business. 8. All U.S. companies must provide their shareholders with an annual report each year. 9. The time period assumption states that the business will remain in operation for the foreseeable future. 10. One way of stating the accounting equation is: Assets + Liabilities = Stockholders' Equity. 11. The concept that a business has a reasonable expectation of remaining in business for the foreseeable future is called the a. economic entity assumption. b. monetary unit assumption. c. time period assumption. d. going concern assumption. 12. Buying and selling products are examples of a. operating activities. b. investing activities. c. financing activities. d. delivering activities. 13. The financial statement that summarizes the changes in retained earning for a specific period of time is the a. balance sheet. b. income statement. c. statement of cash flows. d. retained earnings statement.
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Study Questions (random)--Page 2 14. An income statement a. summarizes the changes in retained earnings for a specific period of time. b. reports the changes in assets, liabilities, and stockholders' equity over a period of time. c. reports the assets, liabilities, and stockholders' equity at a specific date. d. presents the revenues and expenses for a specific period of time. 15. Stockholders' equity a. is usually equal to cash on hand. b. is equal to liabilities and retained earnings. c. includes retained earning and common stock. d. is shown on the income statement. 16. Which of the following would not be considered an external user of accounting data for the XYZ Company? a. Internal Revenue Service Agent b. Management c. Creditors d. Customers 17. The time period assumption states that the economic life of a business can be divided into a. equal time periods. b. cyclical time periods. c. artificial time periods. d. perpetual time periods. 18. Which activities involve acquiring the resources to run the business? a. Delivering
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misc1-4 - Dr. Ron Grambo ACC253 Study Questions (random)...

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