WGU C214 Study Guide Multi Choice Rated 100% Correct!!

Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F) -F Stocks and bonds are two types of financial instruments (T/F) - True The matching principle in accrual accounting requires that: a. Revenues be recognized when the earnings process is complete and matches expenses to revenues recognized. b. Expenses are matched to the year in which they are incurred c. Revenues are matched to the year in which they are booked d. Revenues should be large enough to match expenses - a A high-quality customer just purchased $500,000 worth of product from your company. The contract calls for immediate delivery of the product with a cash payment of $300,000 today and $200,000 to be paid 60 days. The expense associated with the product is $300,000, of which $100,000 has not been paid to your supplier. Under accrual based accounting system, you will most likely report a. revenues of $300,000 and expenses of $300,000. b. revenues of $300,000 and expenses of $200,000. c. revenues of $500,000 and expenses of $300,000. d. revenues of $500,000 and expenses of $200,000. - c A firm reported retained earnings of $300 in 12/31/20x2. For 12/31/20x3, the firm reports retained earnings of $400 and pays dividends of $25. What was net income in 20x3 a. 300 b. 400 c. 125 d. 100 - cA basic equation for the balance sheet is: a. Equity = Assets - Liabilities b. Liabilities = Equity + Assets c. Assets = Liabilities - Equity d. Assets = Equity - Liabilities - a