WSU ACCTG 230 FINAL PAPER EXAM 1 2026
FULL QUESTIONS AND CORRECT ANSWERS
GRADED A+
◉ Recordkeeping/Bookkeeping. Answer: the recording of
transactions and events, either manually or electronically
◉ External Users. Answer: not directly involved in running the
organization, need to all coincide with one method
◉ Internal Information Users. Answer: those directly involved in
managing and operating an organization, not so concerned with
others
◉ Ethics. Answer: beliefs that distinguish right from wrong
◉ Measurement Principle (cost principle). Answer: accounting
information is based on actual cost
◉ Revenue (sales) Recognition. Answer: provides guidance on when
a company must recognize revenue
,◉ Expense Recognition Principle (matching principle). Answer:
record the expenses it incurred to generate the revenue reported
◉ Full Disclosure. Answer: prescribes that a company report the
details behind financial statements that would impact users'
decisions.
◉ Accounting Equation (simple). Answer: Assets = Liabilities +
Equity
◉ Assets. Answer: resources a company owns or controls
◉ Liabilities. Answer: creditors' claims on assets (reflect company
obligations to provide assets, products or services to others)
◉ Equity (net assets/residual equity). Answer: the owner's claim on
assets, has two parts: -contributed capital
-retained earnings
◉ Contributed Capital. Answer: amount that stockholders invest in
the company included under common stock
◉ Retained Earnings. Answer: refer to income (revenues less
expenses) that has not been distributed to its stockholders
, net income - cash dividends = retained earnings
◉ Dividends. Answer: distribution of assets to stockholders
◉ Revenues. Answer: Increase retained earnings and are resources
generated from a company's earnings activities
◉ Expenses. Answer: decrease retained earnings and are the cost of
assets or services used to earn revenues
◉ Accounting Equation (full and complicated). Answer: Assets =
liabilities + Equity [contributed capital + retained earnings]
Assets = liabilities + common stock + retained earnings [- dividends
+ revenue - expenses]
◉ Net Income. Answer: when revenues exceed expenses (increase
equity)
revenue - expenses
◉ Net loss. Answer: when expenses exceed revenues (decrease
equity)
FULL QUESTIONS AND CORRECT ANSWERS
GRADED A+
◉ Recordkeeping/Bookkeeping. Answer: the recording of
transactions and events, either manually or electronically
◉ External Users. Answer: not directly involved in running the
organization, need to all coincide with one method
◉ Internal Information Users. Answer: those directly involved in
managing and operating an organization, not so concerned with
others
◉ Ethics. Answer: beliefs that distinguish right from wrong
◉ Measurement Principle (cost principle). Answer: accounting
information is based on actual cost
◉ Revenue (sales) Recognition. Answer: provides guidance on when
a company must recognize revenue
,◉ Expense Recognition Principle (matching principle). Answer:
record the expenses it incurred to generate the revenue reported
◉ Full Disclosure. Answer: prescribes that a company report the
details behind financial statements that would impact users'
decisions.
◉ Accounting Equation (simple). Answer: Assets = Liabilities +
Equity
◉ Assets. Answer: resources a company owns or controls
◉ Liabilities. Answer: creditors' claims on assets (reflect company
obligations to provide assets, products or services to others)
◉ Equity (net assets/residual equity). Answer: the owner's claim on
assets, has two parts: -contributed capital
-retained earnings
◉ Contributed Capital. Answer: amount that stockholders invest in
the company included under common stock
◉ Retained Earnings. Answer: refer to income (revenues less
expenses) that has not been distributed to its stockholders
, net income - cash dividends = retained earnings
◉ Dividends. Answer: distribution of assets to stockholders
◉ Revenues. Answer: Increase retained earnings and are resources
generated from a company's earnings activities
◉ Expenses. Answer: decrease retained earnings and are the cost of
assets or services used to earn revenues
◉ Accounting Equation (full and complicated). Answer: Assets =
liabilities + Equity [contributed capital + retained earnings]
Assets = liabilities + common stock + retained earnings [- dividends
+ revenue - expenses]
◉ Net Income. Answer: when revenues exceed expenses (increase
equity)
revenue - expenses
◉ Net loss. Answer: when expenses exceed revenues (decrease
equity)
