Final Exam Multiple Choice Question Reveiw Corrected

Final Exam Multiple Choice Question Reveiw Corrected -...

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Review Final Exam Principles of Accounting I Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. Which of the following invests funds into a business and is considered an owner? a. A stockholder b. A creditor c. A bank d. A lender e. More than one of these ____ 2. Which of the following is an organization that lends funds to a business entity and expects repay- ment of the funds? a. A partner b. A stockholder c. An owner d. A creditor ____ 3. The difference between a company's assets and its liabilities, or net assets is: a. Net income. b. Expense. c. Equity. d. Revenue. e. Net loss.
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____ 4. Contingent liabilities must be recorded if: a. The future event is probable and the amount owed can be reasonably estimated. b. The future event is remote. c. The future event is reasonably possible. d. The amount owed cannot be reasonably estimated. e. All of the above. ____ 5. Contingent liabilities must be recorded if: a. The future event is probable and the amount owed can be reasonably estimated. b. The future event is remote. c. The future event is reasonably possible. d. The amount owed cannot be reasonably estimated. e. All of the above. ____ 6. Which one of the following is a correct expression of the accounting equation? a. Assets + Liabilities = Owners' Equity b. Assets = Liabilities - Owners' Equity c. Assets + Owners' Equity = Liabilities d. Assets = Liabilities + Owners' Equity ____ 7. How is the balance sheet linked to the other financial statements? a. The amount of retained earnings reported on the balance sheet is equal to net income. b. Retained earnings is added to total assets and reported on the balance sheet. c. Net income increases retained earnings on the statement of retained earnings, which ulti- mately increases retained earnings on the balance sheet. d. There is no link between the balance sheet and the other statements, as each contains dif- ferent accounts and provides different information.
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____ 8. Merchandise inventory: a. Is a long-term asset. b. Includes supplies.
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This note was uploaded on 12/09/2010 for the course ACCT 201 taught by Professor Tracyedmond during the Fall '10 term at Park.

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Final Exam Multiple Choice Question Reveiw Corrected -...

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