Test Bank for Fundamentals Of Financial Accounting, 7th Canadian Edition by Fred Phillips
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Course
ACCT331
Institution
ACCT331
Complete Test Bank for Fundamentals Of Financial Accounting 7ce 7th Canadian Edition by Fred Phillips, Robert Libby, Patricia Libby, Brandy Mackintosh. Full Chapters are included
Business Decisions and Financial Accounting
The Balance Sheet
The Income Statement
Adjustments, Financial Statemen...
Test Bank for Fundamentals Of Financial Accounting 7ce Phillips
Complete Chapters included - Complete Guide
Chap 01 7ce Phillips
1) Building a new warehouse is an investing activity.
⊚ true
⊚ false
2) The payment of dividends is a financing activity.
⊚ true
⊚ false
3) Daily activities involved in running a business such as buying supplies and paying wages are
operating activities.
⊚ true
⊚ false
4) Financing activities include borrowing and obtaining money by issuing shares of ownership
(called share certificates).
⊚ true
⊚ false
5) Shareholders are creditors of a company.
⊚ true
⊚ false
6) All corporations acquire financing by issuing shares of ownership (called share certificates)
for sale on public stock exchanges.
⊚ true
⊚ false
1
,7) You paid $10,000 to buy 1% of the shares in a corporation that has now gone bankrupt. The
company owes $10 million dollars to creditors. As a result of the bankruptcy, you will lose
$10,000.
⊚ true
⊚ false
8) The shareholders' equity in a company is the difference between assets and liabilities.
⊚ true
⊚ false
9) A company owes $200,000 on a bank loan. If this loan is documented using a formal written
debt contract, it will be reported as a liability called Notes Payable.
⊚ true
⊚ false
10) The accounting decisions that were made when preparing a company's financial statements
are explained in the auditor's report.
⊚ true
⊚ false
11) Under both ASPE and IFRS, a Canadian company would report the data on the financial
statements in Canadian dollars.
⊚ true
⊚ false
2
,12) SUNFLOWER COMPANY
BALANCE SHEET
SEPTEMBER 30, 2023
Assets
Cash $1,568,000
Accounts Receivable 310,500
Inventories 208,200
Property, Plant, and Equipment 391,600
Other Assets 869,400
Total Assets $3,347,700
Liabilities
Contributed Capital 1,263,600
Retained Earnings 207,100
Total Shareholders ’ Equity 1,470,700
Total Liabilities and shareholders ’ Equity $3,347,700
The $207,100 shown on the Balance Sheet has been distributed to shareholders as dividends.
⊚ true
⊚ false
4
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