Financial Accounting Exam 1 Questions And
Answers
corporation a business owned by stockholders. a corporation is a legal entity, an "artificial
person" in the eyes of the law
current asset an asset that is expected to converted into cash, sold, or consumed during the
next 12 months, or within the business's normal operating cycle if longer than a year
current liability a debt due to be paid within one year or within the entity's operating cycle
deficit negative balance in retained earnings caused by net loss over a period of a year
dividends distributions by a corporation to its stockholders
entity an organization or a section of an organization that, for accounting purposes, stands
apart from other organizations and individuals as a separate economic unit
, Financial Accounting Exam 1 Questions And
Answers
ethics standards of right and wrong that transcend economic and legal boundaries. ethical
standards that deal with the way we treat others and restrain our own actions because of the
desire, expectations, or rights of others, or with our obligations to them
expenses decrease in retained earnings that results from operations; the cost of doing
business; opposite of revenues
fair value the amount that a business could sell an asset for, or the amount that a business
could pay to settle a liability
financial accounting the branch of accounting that provides information to people outside
of the firm
financial statements business documents that report financial information about a business
entity to decision makers
financing activities activities that obtain from investors and creditors the cash needed to
launch and sustain the business; a section of the statement of cash flows
, Financial Accounting Exam 1 Questions And
Answers
generally accepted accounting principles accounting guidelines, formulated by the
financial accounting standards board, that govern how accounting is practiced
going-concern assumption holds that the entity will remain in operation for the
foreseeable future
historical cost principle principle that states that assets and services should be recorded as
their actual cost
income statement a financial statement listing an entity's revenues, expenses, and net
income or net loss for a specific period
investing activities activities that increase or decrease the long-term assets available to the
business; a section of the statement of cash flows
liability an economic obligation payable to an individual or an organization outside of the
business
Answers
corporation a business owned by stockholders. a corporation is a legal entity, an "artificial
person" in the eyes of the law
current asset an asset that is expected to converted into cash, sold, or consumed during the
next 12 months, or within the business's normal operating cycle if longer than a year
current liability a debt due to be paid within one year or within the entity's operating cycle
deficit negative balance in retained earnings caused by net loss over a period of a year
dividends distributions by a corporation to its stockholders
entity an organization or a section of an organization that, for accounting purposes, stands
apart from other organizations and individuals as a separate economic unit
, Financial Accounting Exam 1 Questions And
Answers
ethics standards of right and wrong that transcend economic and legal boundaries. ethical
standards that deal with the way we treat others and restrain our own actions because of the
desire, expectations, or rights of others, or with our obligations to them
expenses decrease in retained earnings that results from operations; the cost of doing
business; opposite of revenues
fair value the amount that a business could sell an asset for, or the amount that a business
could pay to settle a liability
financial accounting the branch of accounting that provides information to people outside
of the firm
financial statements business documents that report financial information about a business
entity to decision makers
financing activities activities that obtain from investors and creditors the cash needed to
launch and sustain the business; a section of the statement of cash flows
, Financial Accounting Exam 1 Questions And
Answers
generally accepted accounting principles accounting guidelines, formulated by the
financial accounting standards board, that govern how accounting is practiced
going-concern assumption holds that the entity will remain in operation for the
foreseeable future
historical cost principle principle that states that assets and services should be recorded as
their actual cost
income statement a financial statement listing an entity's revenues, expenses, and net
income or net loss for a specific period
investing activities activities that increase or decrease the long-term assets available to the
business; a section of the statement of cash flows
liability an economic obligation payable to an individual or an organization outside of the
business
