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207Exam1forpractice - Exam 1 covering Ch 1-4 I have removed...

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Exam 1 covering Ch 1 -4. I have removed some that do not relate to our material. There was also an accounting cycle problem. See other file. 1. Stoner Corporation reported the following for Yr2; total assets, $90,000; total liabilities, $35,000; common stock, $40,000. Therefore, retained earnings was a. $ 5,000 b. 40,000 c. 20,000 d. 15,000 2. For a business, a supplier a. is a company or individual that owns shares of the business b. is a company or individual to whom the business sells goods or services c. provides goods and services used by the business d. makes loans to the company to help finance its activities 3. If Zhou Corporation recently purchased goods from you on account, which of Zhou’s financial statements would you look at to determine whether Zhou will be able to pay for the goods when payment is due in 30 days? 4. The separate (or economic) entity assumption states that 5. A business’s assets are 1
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6. During Yr2, its second year in operation, Sanborn Company delivered goods to customers equal to $6,250,000. The amount of cash collected from customers was $6,360,000. The amount of accounts receivable at the beginning of Yr2 was $1,200,000. Based on this information, what is the amount of accounts receivable that Sanborn should report at the end of Yr2? a. $1,310,000 b. $110,000 c. $1,090,000 d. none of the above is correct 7. Retained earnings refers to 8. On the statement of cash flows, a company would report the purchase of machinery as cash used in
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