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MGT 8803 Exam 1 WITH 100 CORRECT QUESTION AND ANSWER

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MGT 8803 Exam 1 WITH 100% CORRECT QUESTION AND ANSWER Proprietorship or Partnership Corporations Assumptions Users of Financial Reports GAAP Qualities of Financial Statements Required Financial Statments Accounting Equation Balance Sheet Assets Cost Principle Liabilities Current vs. Lo...

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  • March 19, 2024
  • 13
  • 2023/2024
  • Exam (elaborations)
  • Questions & answers
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MGT 8803 Exam 1 WITH 100% CORRECT
QUESTION AND ANSWER

1). Proprietorship or partnership

 Ans: Business not legally separated from owners. They have unlimited liability and no
taxation.


2). Corporations

 Ans: public or privately held businesses with limited liability and taxes (shareholders
incl.)


3). Assumptions

 Ans: Separate entity, unity of measurement, going concern, periodicity, materiality


4). Users of financial reports

 Ans: investors, creditors, government agencies, company management, and financial
analysts (Mainly outsiders)


5). Gaap

 Ans: SEC & FASB


6). Qualities of financial statements

 Ans: Understandability, Timeliness, Full disclosure, Comparability, Objectivity, Decision
relevance


7). Required financial statments

 Ans: Balance sheet, Income statement, Statement of Cash Flows


8). Accounting equation




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,  Ans: Assets = Liabilities + Owner's Equity


9). Balance sheet

 Ans: Measures financial position at point in time (assets, liabilities, and owners
equity)


10). Assets

 Ans: Cash, accounts receivables, notes receivable, inventory, investments, buildings &
equipment, copyrights & patents, goodwill


11). Cost principle

 Ans: Assets are valued at their historical cost


12). Liabilities

 Ans: obligations owed to creditors (accounts payable, notes payable, interest payable,
accrued salaries, deferred revenues)


13). Current vs. long-term

 Ans: 1 year


14). Owners equity

 Ans: Residual interest of owners to assets


15). Liabilities + owner's equity

 Ans: Claims against Assets


16). Capital stock

 Ans: What company receives when selling shares of its stock




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