Solutions manual Australian Financial Accounting 9th Edition, 9th Australian edition by Craig Deegan

Test Bank for College Accounting: A Practical Approach, 15th edition by Jeffrey Slater



College Accounting, 15e (Slater) All Chapters ✅
Chapter 1 Accounting Concepts and Procedures

Learning Objective 1-1
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1) The type of business organization where the owners are NOT personally liable for the business’s debts
is a:
A) corporation
E
B) partnership
C) sole proprietorship
D) All of the above
Answer: A
Diff: 2
C
LO: 1-1
E
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles
I
2) The purpose of the accounting process is to provide financial information about:
A) sole proprietorships
P
B) small businesses
C) large corporations
D) All of these answers are correct
Answer: D
G
Diff: 1
LO: 1-1
AACSB: Reflective Thinking
N
Learning Outcome: Define accounting terms, accounting concepts and principles
I S
3) Accounting provides information to:
A) investors
B) government
C) managers
D) All of these answers are correct
R
Answer: D
Diff: 2
LO: 1-1
U
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles
N

1

,4) Which of the following is a characteristic of a sole proprietorship?
A) Business owned by more than one person.
B) Easy to form.
C) Each stockholder acts as an owner of the company.
D) Can continue indefinitely.
S
Answer: B
Diff: 1
LO: 1-1
E
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles
C
5) A partnership is a business which:
A) is easy to form
B) ends with the death of a partner
E
C) is owned by more than one person
D) All of these answers are correct
Answer: D
I
Diff: 1
LO: 1-1
AACSB: Reflective Thinking
P
Learning Outcome: Define accounting terms, accounting concepts and principles
G
6) Which is an advantage of a sole proprietorship form of business?
A) There is limited personal risk.
B) The business can continue indefinitely.
C) The owner makes all the decisions.
N
D) The business is owned by stockholders.
I
Answer: C
Diff: 1
LO: 1-1
S
AACSB: Reflective Thinking
R
Learning Outcome: Define accounting terms, accounting concepts and principles

7) Which of the following is NOT a type of business organization?
A) Corporation
B) Partnership
U
C) Sole proprietorship
D) Limited Asset Corporation
Answer: D
N
Diff: 1
LO: 1-1
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles




2

,8) A corporation:
A) is legally separate from its owners
B) is owned by stockholders
C) has limited risk to stockholders
D) All of the above
S
Answer: D
Diff: 2
LO: 1-1
E
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles
C
9) The basic accounting equation is:
A) Assets + Liabilities = Owner’s Equity
B) Assets = Liabilities - Owner's Equity
E
C) Assets = Owner’s Equity - Liabilities
D) Assets = Liabilities + Owner's Equity
Answer: D
I
Diff: 1
LO: 1-1
AACSB: Reflective Thinking
P
Learning Outcome: Define accounting terms, accounting concepts and principles

10) A law firm would be considered a:
G
A) merchandise company
B) manufacturer
C) service company
N
D) retailer
I
Answer: C
Diff: 1
LO: 1-1
S
AACSB: Reflective Thinking
R
Learning Outcome: Define accounting terms, accounting concepts and principles

11) GAAP stand for ______________________.
A) Generally Accepted Accounting Practices
B) General Accounting Accepted Practices
U
C) Generally Accepted Accounting Principles
D) General Accounting Application Practices
Answer: C
N
Diff: 1
LO: 1-1
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles




3

, 12) The purchase of supplies for cash would affect which account category?
A) Assets
B) Liabilities
C) Capital
D) Expense
S
Answer: A
Diff: 1
LO: 1-1
E
AACSB: Reflective Thinking
Learning Outcome: Analyze and record transactions and their effects on the financial statements
C
13) Items owned by the business such as land, supplies and equipment are:
A) Assets
B) Liabilities
C) Owner's Equity
D) Expenses
E
Answer: A
I
Diff: 1
LO: 1-1
AACSB: Reflective Thinking
P
Learning Outcome: Define accounting terms, accounting concepts and principles

14) Which of the following is NOT an Asset?
G
A) Cash
B) Accounts Receivable
C) Buildings
N
D) All of the above are Assets
I
Answer: D
Diff: 1
LO: 1-1
S
AACSB: Reflective Thinking
Learning Outcome: Define accounting terms, accounting concepts and principles
R
15) If total liabilities increased by $10,000 and the assets increased by $10,000 during the accounting
period, what is the change in the owner's equity amount?
A) No effect on owner's equity
U
B) Decrease of $10,000
C) Increase of $20,000
D) Decrease of $40,000
N
Answer: A
Diff: 2
LO: 1-1
AACSB: Analytical Thinking
Learning Outcome: Analyze and record transactions and their effects on the financial statements




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