CBAD 201- Financial Accounting Final
Review correctly answered to pass
accounting is... - correct answer ✔✔The information system that identifies, records, and communicates
the economic events of an organization to interested users.
Who uses accounting information? - correct answer ✔✔Individuals, investors and creditors, regulatory
bodies, nonprofit organizations
Financial Accounting - correct answer ✔✔accounting information and analyses prepared for people
outside the organization
Managerial Accounting - correct answer ✔✔accounting used to provide information and analyses to
managers inside the organization to assist them in decision making
Proprietorship - correct answer ✔✔A business owned by one person
Partnership - correct answer ✔✔A business in which two or more persons combine their assets and skills
Limited Liability Company - correct answer ✔✔A business organization in which the business (not the
owner) is liable for the company's debts
Corporation - correct answer ✔✔A business owned by stockholders who share in its profits but are not
personally responsible for its debts
the entity assumption - correct answer ✔✔Organization stands apart from other organizations and
individuals as a separate economic unit
the continuity assumption - correct answer ✔✔States that businesses are assumed to continue to
operate into the foreseeable future.
, Historical Cost Principle - correct answer ✔✔An accounting principle that states that companies should
record assets at their cost.
stable monetary unit assumption - correct answer ✔✔The reason for ignoring the effect of inflation in
the accounting records, based on the assumption that the dollar's purchasing power is relatively stable.
Accounting Equation - correct answer ✔✔An equation showing the relationship among assets, liabilities,
and owner's equity
assets - correct answer ✔✔money and other valuables belonging to an individual or business
liabilities - correct answer ✔✔Amounts owed to creditors
Stockholders' Equity - correct answer ✔✔The owners' claim to assets.
paid-in capital - correct answer ✔✔the amount stockholders have invested in the company
retained earnings - correct answer ✔✔An amount earned by a corporation and not yet distributed to
stockholders.
revenues - correct answer ✔✔The financial resources of the government. The individual income tax and
Social Security tax are two major sources of the federal government's revenue.
expenses - correct answer ✔✔The cost of assets consumed or services used in the process of generating
revenues.
dividends - correct answer ✔✔earnings distributed to stockholders
Income Statement - correct answer ✔✔A financial statement showing the revenue and expenses for a
fiscal period.
Review correctly answered to pass
accounting is... - correct answer ✔✔The information system that identifies, records, and communicates
the economic events of an organization to interested users.
Who uses accounting information? - correct answer ✔✔Individuals, investors and creditors, regulatory
bodies, nonprofit organizations
Financial Accounting - correct answer ✔✔accounting information and analyses prepared for people
outside the organization
Managerial Accounting - correct answer ✔✔accounting used to provide information and analyses to
managers inside the organization to assist them in decision making
Proprietorship - correct answer ✔✔A business owned by one person
Partnership - correct answer ✔✔A business in which two or more persons combine their assets and skills
Limited Liability Company - correct answer ✔✔A business organization in which the business (not the
owner) is liable for the company's debts
Corporation - correct answer ✔✔A business owned by stockholders who share in its profits but are not
personally responsible for its debts
the entity assumption - correct answer ✔✔Organization stands apart from other organizations and
individuals as a separate economic unit
the continuity assumption - correct answer ✔✔States that businesses are assumed to continue to
operate into the foreseeable future.
, Historical Cost Principle - correct answer ✔✔An accounting principle that states that companies should
record assets at their cost.
stable monetary unit assumption - correct answer ✔✔The reason for ignoring the effect of inflation in
the accounting records, based on the assumption that the dollar's purchasing power is relatively stable.
Accounting Equation - correct answer ✔✔An equation showing the relationship among assets, liabilities,
and owner's equity
assets - correct answer ✔✔money and other valuables belonging to an individual or business
liabilities - correct answer ✔✔Amounts owed to creditors
Stockholders' Equity - correct answer ✔✔The owners' claim to assets.
paid-in capital - correct answer ✔✔the amount stockholders have invested in the company
retained earnings - correct answer ✔✔An amount earned by a corporation and not yet distributed to
stockholders.
revenues - correct answer ✔✔The financial resources of the government. The individual income tax and
Social Security tax are two major sources of the federal government's revenue.
expenses - correct answer ✔✔The cost of assets consumed or services used in the process of generating
revenues.
dividends - correct answer ✔✔earnings distributed to stockholders
Income Statement - correct answer ✔✔A financial statement showing the revenue and expenses for a
fiscal period.
