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Exam 1 Fundamentals of Accounting questions with correct answers.
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Exam 1 Fundamentals of Accountingquestions with correct answers.
B) Financial Accounting Standards Board ANS - Which of the following groups has the primary
responsibility for establishing generally accepted accounting principles for business entities in the United
States?
A) U.S. Congress
B) Financial Accounting Standards Board
C) International Accounting Standards Board
D) Securities and Exchange Commission
D) Creditors ANS - Which resource providers lend financial resources to a business with the expectation
of repayment of interest?
A) Consumers
B) Owners
C) Investors
D) Creditors
A) Financial Accounting ANS - Which type of accounting information is intended to satisfy the needs of
external users of accounting information?
A) Financial Accounting
B) Managerial Accounting
C) Tax Accounting
D) Cost Accounting
B) Generally Accepted Accounting Principles ANS - Financial accounting standards are known
collectively as GAAP. What does that acronym stand for?
,A) Generally Authorized Auditing Principles
B) Generally Accepted Accounting Principles
C) Governmentally Approved Accounting Practices
D) Generally Applied Accounting Procedures
C) International Accounting Standards Board ANS - International accounting standards are formulated
by the IASB. What does that acronym stand for?
A)International Accounting and Sustainability Board
B) International Accounting Standards Bureau
C) International Accounting Standards Board
D) Internationally Accepted Standards Board
A) Cash received from customers at the time services were provided ANS - Which of the following items
is an example of revenue?
A) Cash received from customers at the time services were provided
B) Cash received from the sale of land for its original selling price
C) Cash received from a bank loan
D) Cash received from investors from the sale of common stock
A) $13,000
Assets=Liability+Equity
$22,000-$15,000=$13,000 ANS - The balance sheet of the Alonquin Company reported assets of
$50,000, liabilities of $22,000 and common stock of $15,000. Based on this information only, the
amount or balance for retained earnings must be:
, A) $13,000
B) $57,000
C) $87,000
D) $7,000
C) $300
$500-$200= $300 ANS - If Ballard Company reported assets of $500 and liabilities of $200, Ballard's
stockholders' equity equals:
A) $500
B) $700
C) $300
D) Cannot be determined
A) total assets were unaffected ANS - Li Company paid cash to purchase land. As a result of this
accounting event:
A) total assets were unaffected
B) total assets decreased
C) both assets and total equity decreased
D) total equity decreased
B) Cash and Revenue
money coming IN ANS - The transaction, "provided services for cash," affects which two accounts?
A) Cash and Dividends
B) Cash and Revenue
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