acc quizs 1-3 - Chapter 1 1. Accounting provides...

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Chapter 1 1. Accounting provides information to help in making decisions about organizations. Which of the following statements concerning accounting information is FALSE? It helps decision makers determine a. where they are b. where they should be c. where they have been d. where they are going 2. The primary purpose of accounting is to a. audit the financial information of businesses b. certify the accuracy of records c. facilitate decision making by the stakeholders d. provide for internal control over financial transactions 3. You are inspecting the profit statement of a company. It reports profit of $6,000. From this information, you can conclude that a. the owners have a rather small investment in the firm b. the company is a merchandising firm c. there have been financing and investing activities during the period but no operating activities d. the value of resources received from sales exceeds the value of resources consumed 4. Last summer, Regina operated a house cleaning service to earn money for college. To start the business, she invested $700 of her savings which she used to rent equipment and buy supplies. At the end of the summer, all the supplies had been consumed and the equipment had been returned. Regina's income statement for the summer reported a profit of $5,000. If Regina withdraws $5,700 from the business, we can determine that Regina's "return on investment" and "return of investment" were Return on Investment Return of Investment a. $700 $5,000 b. $4,300 $700 c. $5,000 $700 d. $5,000 cannot be determined Return on (profit, because>profit on your investment) $5000 Retrun of (cost, because> return of what you put in) $700 5. Singer Company and Triton Company both sell used books. Singer Company buys books at an average cost of $10 per book and sells them for $15 each. Triton Company buys books for $10 each and sells them for $17 each. This year, Singer Company sold 3,500 books and Triton Company sold 1,000 books. Indicate which company was more effective and which company was more efficient. More Effective More Efficient a. Triton Triton b. Triton Singer c. Singer Triton d. Singer Singer BUY SELL # PROFIT (total) T $10 $17 1000 (17-10)*1000= $7000
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S $10 $15 3500 (15-10)*3500=$17500 EFFECTIVE= most $ total=> S b/c 17500>7000 EFFICIENT= most $ per order=> T b/c (17-10)>(15-10) 6. Mutual agency is a concept that applies to The Partners The Shareholders in a Partnership of a Corporation a. Yes Yes b. Yes No c. No Yes d. No No Mutual Agency is the rights of all partners to act as agents for regular business. Partners could order stuff in the business name, and shareholders can not. So B is the answer. B/C even though I am a shareholder in apple I couldn’t order and iphone and charge apple for the phone I would have to pay for it. 7.
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This note was uploaded on 04/02/2011 for the course ACCT 310F taught by Professor Steinmann during the Spring '11 term at University of Texas.

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acc quizs 1-3 - Chapter 1 1. Accounting provides...

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