Accounting Midterm WileyPLus: Questions With
Complete Solutions
Jack and Jill form a partnership. Jack runs the business in New York, while Jill
vacations in Hawaii. During the time Jill is away from the business, Jack
increases the debts of the business by $20,000. Which of the following
statements is true regarding this debt? Correct Answer - Both Jack and Jill
are personally liable for the business debt.
An advantage of the corporate form of business is that
-it is simple to establish
-it has limited life.
-its owner's personal resources are at stake.
-its ownership is easily transferable via the sale of shares of stock. Correct
Answer - its ownership is easily transferable via the sale of shares of stock.
Which type of corporate information is not available to investors? Correct
Answer - Forecast of cash needs for the upcoming year.
The right to receive money in the future is called a(n) Correct Answer -
account receivable.
Borrowing money is an example of a(n) Correct Answer - financing activity
Which activities involve putting the resources of the business into action to
generate a profit? Correct Answer - Operating
Resources owned by a business are referred to as Correct Answer - assets
When expenses exceed revenues, which of the following is true? Correct
Answer - A net loss
Which of the following is not a liability?
-Interest Payable
-Unearned Service Revenue
-Accounts Payable
-Accounts Receivable Correct Answer - Accounts Receivable
Complete Solutions
Jack and Jill form a partnership. Jack runs the business in New York, while Jill
vacations in Hawaii. During the time Jill is away from the business, Jack
increases the debts of the business by $20,000. Which of the following
statements is true regarding this debt? Correct Answer - Both Jack and Jill
are personally liable for the business debt.
An advantage of the corporate form of business is that
-it is simple to establish
-it has limited life.
-its owner's personal resources are at stake.
-its ownership is easily transferable via the sale of shares of stock. Correct
Answer - its ownership is easily transferable via the sale of shares of stock.
Which type of corporate information is not available to investors? Correct
Answer - Forecast of cash needs for the upcoming year.
The right to receive money in the future is called a(n) Correct Answer -
account receivable.
Borrowing money is an example of a(n) Correct Answer - financing activity
Which activities involve putting the resources of the business into action to
generate a profit? Correct Answer - Operating
Resources owned by a business are referred to as Correct Answer - assets
When expenses exceed revenues, which of the following is true? Correct
Answer - A net loss
Which of the following is not a liability?
-Interest Payable
-Unearned Service Revenue
-Accounts Payable
-Accounts Receivable Correct Answer - Accounts Receivable
