Acct 101 Exam 1 Questions with
Verified Solutions
Identify the users of financial information - ANS-banks, owners, suppliers, customers
Entity has its own separate - ANS-identity
An entity whose entire purpose is to produce a profit for its owners is an - ANS-
economic entity
Funds taken from owner for personal use is - ANS-withdrawals
Income statement shows - ANS-revenue, expenses, net income
Balance sheet shows - ANS-assets, liabilities, owner's equity
Statement of Owner's Equity - ANS-A summary of the changes in owner's equity that
have occurred during a specific period of time, such as a month or a year.
Which is true in the preparation of financial statements - ANS-net income from the
income statement is placed into statement of owner's equity
the company or individuals that amounts are owed to are - ANS-creditors
Fundamental Accounting Equation - ANS-Assets = Liabilities + Owner's Equity
revenue - ANS-The amount of money that a company actually receives from sales
expenses - ANS-the cost that a business incurs in order to operate
accounting is called - ANS-the language of business
Accounting system - ANS-A process designed to accumulate, classify and summarize
financial data
Certified public accountant (CPA) - ANS-An independent accountant who provides
accounting services to the public for a fee
accounting - ANS-The process by which financial information about a business is
recorded, classified, summarized, interpreted, and communicated to owners, managers,
and other interested parties
, bookkeeper - ANS-someone who records the transactions of a business
accountant - ANS-A person who plans, summarizes, analyzes, and interprets
accounting information.
accounting clerk - ANS-An accounting worker who processes routine details about
accounting transactions.
Which statements are true about SEC - ANS-SEC has final say on financial accounting
issues faced by publicly traded companies, can suspend trading of company's shares
Auditing - ANS-The review of financial statements to assess their fairness and
adherence to generally accepted accounting practices
Sarbanes-Oxley Act includes which of the following provisions - ANS-prohibits
destruction or creation of documents to impede a federal investigation
Managerial Accounting - ANS-Accounting work carried on by an accountant employed
by a single business in industry, the branch of accounting that provides financial
tax accounting involves which activities - ANS-tax planning and tax compliance
MANAGERIAL ADVISORY SERVICES - ANS-Services designed to help clients
improve their information systems or business performance
Dollar signs are used on income statements prepared on plain paper - ANS-True
What is shown on statement of owner's equity, in order? - ANS-beginning capital, net
income, withdrawals, ending capital
Steps to financial event analysis - ANS-identify the property, identify who owns the
property, determine amount of increase or decrease
Examples of Assets - ANS-cash, accounts receivable, supplies, equipment
Examples of Liabilities - ANS-accounts payable
Examples of Owner's Equity - ANS-Capital, Drawings
If a business issues a check for $100 to purchase office supplies, What is the effect on
the accounting equation? - ANS-Total assets will remain the same
Total assets of Douglas Fuhr Furniture Co. are $84,000 and the total liabilities are
$37,000. What is the amount of the owner's equity? - ANS-$47,000
Verified Solutions
Identify the users of financial information - ANS-banks, owners, suppliers, customers
Entity has its own separate - ANS-identity
An entity whose entire purpose is to produce a profit for its owners is an - ANS-
economic entity
Funds taken from owner for personal use is - ANS-withdrawals
Income statement shows - ANS-revenue, expenses, net income
Balance sheet shows - ANS-assets, liabilities, owner's equity
Statement of Owner's Equity - ANS-A summary of the changes in owner's equity that
have occurred during a specific period of time, such as a month or a year.
Which is true in the preparation of financial statements - ANS-net income from the
income statement is placed into statement of owner's equity
the company or individuals that amounts are owed to are - ANS-creditors
Fundamental Accounting Equation - ANS-Assets = Liabilities + Owner's Equity
revenue - ANS-The amount of money that a company actually receives from sales
expenses - ANS-the cost that a business incurs in order to operate
accounting is called - ANS-the language of business
Accounting system - ANS-A process designed to accumulate, classify and summarize
financial data
Certified public accountant (CPA) - ANS-An independent accountant who provides
accounting services to the public for a fee
accounting - ANS-The process by which financial information about a business is
recorded, classified, summarized, interpreted, and communicated to owners, managers,
and other interested parties
, bookkeeper - ANS-someone who records the transactions of a business
accountant - ANS-A person who plans, summarizes, analyzes, and interprets
accounting information.
accounting clerk - ANS-An accounting worker who processes routine details about
accounting transactions.
Which statements are true about SEC - ANS-SEC has final say on financial accounting
issues faced by publicly traded companies, can suspend trading of company's shares
Auditing - ANS-The review of financial statements to assess their fairness and
adherence to generally accepted accounting practices
Sarbanes-Oxley Act includes which of the following provisions - ANS-prohibits
destruction or creation of documents to impede a federal investigation
Managerial Accounting - ANS-Accounting work carried on by an accountant employed
by a single business in industry, the branch of accounting that provides financial
tax accounting involves which activities - ANS-tax planning and tax compliance
MANAGERIAL ADVISORY SERVICES - ANS-Services designed to help clients
improve their information systems or business performance
Dollar signs are used on income statements prepared on plain paper - ANS-True
What is shown on statement of owner's equity, in order? - ANS-beginning capital, net
income, withdrawals, ending capital
Steps to financial event analysis - ANS-identify the property, identify who owns the
property, determine amount of increase or decrease
Examples of Assets - ANS-cash, accounts receivable, supplies, equipment
Examples of Liabilities - ANS-accounts payable
Examples of Owner's Equity - ANS-Capital, Drawings
If a business issues a check for $100 to purchase office supplies, What is the effect on
the accounting equation? - ANS-Total assets will remain the same
Total assets of Douglas Fuhr Furniture Co. are $84,000 and the total liabilities are
$37,000. What is the amount of the owner's equity? - ANS-$47,000
