MGMT 200 Exam 1 Questions and Answers Already Passed Latest Update 2025-2026
Preparing a budget for a business is considered
A. financial accounting.
B. managerial accounting. - Answers B
Accounting is the information system that
A. measures business activities
B. communicates the results to decision makers
C. processes information into reports
D. all of the above. - Answers D
Which of the following is not an external user of a business's financial information?
A. Taxing authorities
B. Customers
C. Employees
D. Investors - Answers C
Which statement below best describes the accounting equation?
A. The change in retained earnings equals net income less dividends.
B. Equality of revenue and expense transactions over time.
C. Financing activities equal investing and operating activities.
D. Resources of the company equal creditors' and owners' claims to those resources. - Answers D
assets = liabilities +stockholders' equity
Owners' claims to the company's resources are referred to as:
A. Liabilities.
B. Assets.
C. Stockholders' equity.
D. Net liabilities. - Answers C
,assets = liabilities +stockholders' equity
If total assets of a company equal $25,000 and total stockholders' equity equals $10,000, then total
liabilities equal $15,000.
A. True
B. False - Answers A
Assets = Liabilities + Equity $25,000 = $15,000 + $10,000
Amounts owed to suppliers for supplies purchased on account are defined as a(n):
A. Revenue.
B. Asset.
C. Liability.
D. Expense. - Answers C
assets = liabilities + stockholders' equity
If total liabilities of a company equal $29,000 and total stockholders' equity equals $15,000, then total
assets equal $14,000. A. True
B. False - Answers B
Assets = Liabilities + Equity $44,000 = $29,000 + $15,000
Financial Accounting - Answers accounting information and analyses prepared for people outside the
organization
Managerial Accounting - Answers accounting used to provide information and analyses to managers
inside the organization to assist them in decision making
Financial accounting does not deal with which of the following?
A. Measuring a company's economic activity.
B. Providing information to internal users.
C. Preparing financial reports.
D. Communicating financial results to investors. - Answers B
The accounting equation shows that a company's resources equal creditors' and owners' claims to those
resources.
, A. True
B. False - Answers A
An alternative form of the accounting equation is:
A. Assets - Liabilities = Stockholders' Equity.
B. Net Income = Revenues ‐Expenses.
C. Stockholders' Equity = Assets + Liabilities.
D. Assets = Liabilities ‐Stockholders' Equity. - Answers A
Which of the following does not represent an asset of a company?
A. Supplies held by the company.
B. Amounts owed to suppliers.
C. Equipment owned and used for operations.
D. Amounts receivable from customers. - Answers B, issa liability
The amounts recorded when the company sells products or provides services to customers are referred
to as:
A. Liabilities
B. Revenues
C. Assets
D. Expenses - Answers B Revenues are recorded at the time the company provides products or services
to customers.
If a company has stockholders' equity of $25,000 at the end of the year, which of the following
statements must be true?
A. The company has issued $25,000 of common stock.
B. Net income for the year equals $25,000.
C. The company's assets exceed liabilities by $25,000.
D. Total revenues during the year equal $25,000. - Answers C
assets = liabilities + stockholders' equity assets ‐liabilities = stockholders' equity assets ‐liabilities =
$25,000
Preparing a budget for a business is considered
A. financial accounting.
B. managerial accounting. - Answers B
Accounting is the information system that
A. measures business activities
B. communicates the results to decision makers
C. processes information into reports
D. all of the above. - Answers D
Which of the following is not an external user of a business's financial information?
A. Taxing authorities
B. Customers
C. Employees
D. Investors - Answers C
Which statement below best describes the accounting equation?
A. The change in retained earnings equals net income less dividends.
B. Equality of revenue and expense transactions over time.
C. Financing activities equal investing and operating activities.
D. Resources of the company equal creditors' and owners' claims to those resources. - Answers D
assets = liabilities +stockholders' equity
Owners' claims to the company's resources are referred to as:
A. Liabilities.
B. Assets.
C. Stockholders' equity.
D. Net liabilities. - Answers C
,assets = liabilities +stockholders' equity
If total assets of a company equal $25,000 and total stockholders' equity equals $10,000, then total
liabilities equal $15,000.
A. True
B. False - Answers A
Assets = Liabilities + Equity $25,000 = $15,000 + $10,000
Amounts owed to suppliers for supplies purchased on account are defined as a(n):
A. Revenue.
B. Asset.
C. Liability.
D. Expense. - Answers C
assets = liabilities + stockholders' equity
If total liabilities of a company equal $29,000 and total stockholders' equity equals $15,000, then total
assets equal $14,000. A. True
B. False - Answers B
Assets = Liabilities + Equity $44,000 = $29,000 + $15,000
Financial Accounting - Answers accounting information and analyses prepared for people outside the
organization
Managerial Accounting - Answers accounting used to provide information and analyses to managers
inside the organization to assist them in decision making
Financial accounting does not deal with which of the following?
A. Measuring a company's economic activity.
B. Providing information to internal users.
C. Preparing financial reports.
D. Communicating financial results to investors. - Answers B
The accounting equation shows that a company's resources equal creditors' and owners' claims to those
resources.
, A. True
B. False - Answers A
An alternative form of the accounting equation is:
A. Assets - Liabilities = Stockholders' Equity.
B. Net Income = Revenues ‐Expenses.
C. Stockholders' Equity = Assets + Liabilities.
D. Assets = Liabilities ‐Stockholders' Equity. - Answers A
Which of the following does not represent an asset of a company?
A. Supplies held by the company.
B. Amounts owed to suppliers.
C. Equipment owned and used for operations.
D. Amounts receivable from customers. - Answers B, issa liability
The amounts recorded when the company sells products or provides services to customers are referred
to as:
A. Liabilities
B. Revenues
C. Assets
D. Expenses - Answers B Revenues are recorded at the time the company provides products or services
to customers.
If a company has stockholders' equity of $25,000 at the end of the year, which of the following
statements must be true?
A. The company has issued $25,000 of common stock.
B. Net income for the year equals $25,000.
C. The company's assets exceed liabilities by $25,000.
D. Total revenues during the year equal $25,000. - Answers C
assets = liabilities + stockholders' equity assets ‐liabilities = stockholders' equity assets ‐liabilities =
$25,000
