MGT 8803

Ending Retained Earnings correct answer: beginning retained earnings + net income - dividends Statement of Stockholders' Equity correct answer: Beginning Stockholders Equity + Net Income - Dividends + Issuance of Capital Stock Net Income correct answer: Revenues Earned -Expenses Incurred Cost of Goods Sold correct answer: Beginning Inventory + Net Purchases - Ending Inventory Straight Line Depreciation (Contra Asset) correct answer: (cost - salvage value) / useful life Goodw...

Balance Sheet correct answer: A financial statement that reports assets, liabilities, and owner's equity on a specific date. Income Statement correct answer: A financial statement showing the revenue and expenses for a fiscal period. What is net income? correct answer: Revenues - Expenses What is net income also called? correct answer: Profit or "the bottom line" What is equity source? correct answer: Amount provided by the owner. What are liabilities? correct answer: Amo...

Which one of the following is reported on the Balance Sheet at current market value? a) Accounts Receivable b) Buildings c) Treasury Stock d) Land e) Marketable Securities correct answer: e) Marketable Securities The form of business organization that is legally separate from its owners is a: correct answer: Corporation A clean financial statement audit opinion will state that the financial statements are guaranteed to be accurate... TRUE OR FALSE? correct answer: FALSE Acco...

Forms of Businesses: Proprietorship & Partnership • ____________liability • No ____________ (on the business; the owner, however days pay taxes) Corporation (Shareholders -> Board of Directors -> Top Managers) • ____________ liability • Taxation (corporations pay taxes, shareholders pay taxes on earnings) • Can be ____________ traded or ____________ held. correct answer: unlimited, taxation, limited, publicly, privately Assumption that we treat the business and ...

3 factors that effect planning of organization correct answer: 1) organization level (more heirarchy better with more stability) 2) degree of uncertainty (more uncertain, shorter planning horizon) 3) length of future commitments (planning horizon should be as long as length of longest commitment by management 4 functions of management correct answer: 1) planning: business goals 2) organizing: allocating resources 3) leading: coordinating and directing 4) controlling: observe and analyz...

Why are financial ratios used? correct answer: Used to enable financial statement users to examine how a firm has performed relative to its peers and relative to its own historical performance. What does differences in ratios for the two companies in the same industry indicate? correct answer: It can be a result of: 1) Different product market strategy 2) Management team effectiveness 3) Different financial strategies What is Return on Equity (ROE)? correct answer: = Net Income / Boo...

Unit of measurement 3. Going concern 4. Periodicity 5. Materiality What does materiality mean? correct answer: The only information that needs to be disclosed in financial statements is information that will be useful for those who rely on the financial statements to make decisions. What are the qualities of financial statements? (6) correct answer: 1. Understandability 2. Timeliness 3. Full disclosure 4. Comparability 5. Objectivity 6. Decision relevance What are the three ba...

cash correct answer: Current Asset (BS) Deferred Revenue correct answer: Current Liability (BS) Treasury Stock correct answer: Contra-Equity (BS) Cost of Goods Sold correct answer: Expense (IS) Interest Expense correct answer: Expense (IS) Sales correct answer: Revenue (IS) Sales Discounts correct answer: Contra-Revenue (IS) Sales Returns correct answer: Contra-Revenue (IS) Discounts on Bonds Payable correct answer: Contra - Liability (BS) Inventory correct an...

Promotion Types correct answer: 1. personal selling 2. mass selling 3. sales promotion Marketing Mix Levers correct answer: 4 P's - product, place, price, promotion Accumulating correct answer: Collecting products from many small producers Acquisition correct answer: where the company converts a prospect into a customer, meaning they are actually using their offerings and paying for them Activities correct answer: identify what people do and are objectively observable Adop...

Proprietorship correct answer: Single Owner; unlimited liability & no taxation Partnership correct answer: More than one owner; unlimited liability & no taxation Corporation correct answer: A business owned by stockholders (shareholders -> board of directors --> top managers); limited liability & taxation Publicly traded or privately held Assumptions of Financial Accounting correct answer: Separate entity, unit of measurement, going concern, periodicity, materiality Goin...