ACTG244 EXAM 1 ACTUAL QUESTIONS AND ACCURATE
ANSWERS
assets - CORRECT ANSWER✅✅✅things you *own* or have rights of ownership to
examples of assets - CORRECT ANSWER✅✅✅cash, accounts receivable, inventory, land,
buildings, prepaid rent, prepaid insurance
examples of liabilities - CORRECT ANSWER✅✅✅accounts payable, accurred payable,
wages and salaries payable, loans payable, interest payable, mortgages payable, unearned
revenue
equity - CORRECT ANSWER✅✅✅difference between total assets - total liabilities
two types of equity - CORRECT ANSWER✅✅✅-contributed capital: investments made by
owners into business through purchase of stock
-retained earnings: net income earned by corporation that is kept for company growth &
expansion (rather than giving stockholders dividends)
Net Income - CORRECT ANSWER✅✅✅net amount of revenue - expenses + gains - losses.
total of the income statement
withdrawls - CORRECT ANSWER✅✅✅assets taken out of a business for the owner's
personal use
Dividends - CORRECT ANSWER✅✅✅board of directions decide to distribute earnings to
stockholders
elements of a financial statement - CORRECT ANSWER✅✅✅assets, liabilities, equity,
income statement accounts
, 4 types of reporting entities - CORRECT ANSWER✅✅✅- business
- nonprofit
- govt
-quasi government
3 types of businesses - CORRECT ANSWER✅✅✅- sole proprietorship
-partnership
- corporation
business ownership - CORRECT ANSWER✅✅✅shareholders
governance - CORRECT ANSWER✅✅✅board of directors
management - CORRECT ANSWER✅✅✅planning and operations
four primary financial statements - CORRECT ANSWER✅✅✅- income statement
- statement of cash flows
- statement of changes of owners equity
- balance sheet
the entity principle - CORRECT ANSWER✅✅✅the business is separate from the owner
and other entities, and its records should be kept on this basis
Public Accountant - CORRECT ANSWER✅✅✅an accountant who provides accounting
services to individuals or businesses on a fee basis. for hire services.
Private Accountant - CORRECT ANSWER✅✅✅an accountant who provides services for
the entity that employees him. management accountant. doesn't have to be certified
ANSWERS
assets - CORRECT ANSWER✅✅✅things you *own* or have rights of ownership to
examples of assets - CORRECT ANSWER✅✅✅cash, accounts receivable, inventory, land,
buildings, prepaid rent, prepaid insurance
examples of liabilities - CORRECT ANSWER✅✅✅accounts payable, accurred payable,
wages and salaries payable, loans payable, interest payable, mortgages payable, unearned
revenue
equity - CORRECT ANSWER✅✅✅difference between total assets - total liabilities
two types of equity - CORRECT ANSWER✅✅✅-contributed capital: investments made by
owners into business through purchase of stock
-retained earnings: net income earned by corporation that is kept for company growth &
expansion (rather than giving stockholders dividends)
Net Income - CORRECT ANSWER✅✅✅net amount of revenue - expenses + gains - losses.
total of the income statement
withdrawls - CORRECT ANSWER✅✅✅assets taken out of a business for the owner's
personal use
Dividends - CORRECT ANSWER✅✅✅board of directions decide to distribute earnings to
stockholders
elements of a financial statement - CORRECT ANSWER✅✅✅assets, liabilities, equity,
income statement accounts
, 4 types of reporting entities - CORRECT ANSWER✅✅✅- business
- nonprofit
- govt
-quasi government
3 types of businesses - CORRECT ANSWER✅✅✅- sole proprietorship
-partnership
- corporation
business ownership - CORRECT ANSWER✅✅✅shareholders
governance - CORRECT ANSWER✅✅✅board of directors
management - CORRECT ANSWER✅✅✅planning and operations
four primary financial statements - CORRECT ANSWER✅✅✅- income statement
- statement of cash flows
- statement of changes of owners equity
- balance sheet
the entity principle - CORRECT ANSWER✅✅✅the business is separate from the owner
and other entities, and its records should be kept on this basis
Public Accountant - CORRECT ANSWER✅✅✅an accountant who provides accounting
services to individuals or businesses on a fee basis. for hire services.
Private Accountant - CORRECT ANSWER✅✅✅an accountant who provides services for
the entity that employees him. management accountant. doesn't have to be certified
