ETS Exam Questions & Answers 2024/2025
Financial Statements - ANSWERSare the business documents that companies use to report
the results of activities to various external user groups.
Accounting - ANSWERSis an information system. It measures business activities, processes date into reports...
Financial Statements - ANSWERSare the business documents that companies use to report
the results of activities to various external user groups.
Accounting - ANSWERSis an information system. It measures business activities, processes date into
reports (including financial statements) and communicates results to
decision makers. Accounting is the "language of business"
Users of Accounting Information - ANSWERSIndividual
Investors and Creditors
Regulatory Bodies
Nonprofit Organizations
Financial Accounting - ANSWERSProvides information for decision makers outside the entity.
Investors
Creditors
Government agencies
And the public
Managerial Accounting - ANSWERSProvides information for internal users, management
proprietorship - ANSWERSis a single owner.
Partnership - ANSWERSTwo or more parties are co-owners and each owner is a partner.
, Limited Liability Company (LLC) - ANSWERSOne in which the business (not the owner) is liable for the
company's debt.
Corporation - ANSWERSIs a business owner by stockholder or shareholders who own stock (common or
preferred) representing shares of ownership in that corporation.
The Accounting Equation - ANSWERSAssets = Liabilities + Owners Equity
Assets - ANSWERSEconomic resources that are expected to produce a benefit in the future
Current assets - ANSWERSexpected to be converted to cash, sold or consumed during
the next 12 months or business operations cycle. Whichever is longer.
Liabilities - ANSWERSOutside claims. Debts payable to creditors
Owners' Equity or Shareholders Equity - ANSWERSInsider claims.
The Income Statement or Statement of Operations - ANSWERSRevenues minus expenses to equal Net
Income.
The Statement of Retained Earnings - ANSWERSShows What a company did with it's Net Income.
Retained Earnings is the portion of net income that has been kept by t he
company
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