FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 1: Accounting and the Business Environment

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 41

Multiple Choice

Review LaterAdd Note

Review Later

Scott's Camera Shop started the year with total assets of $80,000 and total liabilities of $40,000. During the year, the business earned revenues of $120,000 and incurred expenses of $70,000. Scott made no capital contributions during the year, but did make withdrawals of $60,000. The net change in Scott's owner's equity for the year is a:

A) $10,000 decrease.
B) $40,000 increase.
C) $30,000 decrease.
D) $50,000 increase.

Correct Answer

verified

Show Answer

Question 42

True/False

Review LaterAdd Note

Review Later

A proprietor may have to pay self-employment tax in addition to income tax.

Correct Answer

verified

Show Answer

Question 43

Multiple Choice

Review LaterAdd Note

By definition, which of the following represents the owners of a corporation?

Board members of a not-for-profit organization have fiduciary responsibilities which constitute legal obligations to manage the organization in a trust-worthy manner.

IFRS accounting rules apply to all U.S. corporations.

GAAP refer to the set of accounting rules for international accounting.

Equipment is sold for cash in an amount equal to the cost of the equipment recorded on the books. How does this sale affect the accounting equation?

The PCAOB is a watchdog agency that monitors the work of small, privately owned businesses.

The AICPA's Code of Professional Conduct for Accountants provides guidance to CPAs in the performance of their work.

Items such as buildings and land are:

ABC Delivery Service had the following transactions in June: Earned $4,000 cash for services rendered; collected $2,500 from a customer "on account;" paid out $200 cash for plumbing services; received $3,500 of supplies and promised to pay one month later; paid out $1,000 in cash drawings to the owner. How much was Net income in June?

Accounting is "the language of business."

Land was originally purchased for $20,000. It is sold for $20,000 in cash. How does the sale affect the accounting equation?

Which of the following financial statements reports cash receipts and cash payments during a period of time?

A proprietorship is created by:

Which of the following financial statements lists the entity's assets, liabilities, and owner's equity as of a specific date?

Ace Builders had the following transactions in June: Earned $4,000 "on account;" collected $3,000 from a customer which was owed from a previous month; incurred $500 of repair expense and paid cash to the repairman; paid $1,200 to a supplier that it owed from the previous month; paid out $800 in cash drawings to the owner. How much was the Net income in June?

Land is purchased by the business for $100,000. The company pays for land with a $20,000 cash payment and the execution of an $80,000 promissory note payable to the seller. How does this purchase affect the business's accounting equation?

Martin Supply Service received $1,000 cash from a customer which was owed to the business from the previous month. What is the effect of the cash receipt on the accounts of the business?

Which of the following concepts (or principles) would dictate that a person with three different businesses keep three different checking accounts?