ACC 231 Chapter 1 Question and
answers correctly solved 2025/2026
accounting - correct answer ✔"language of business"
system of maintaining records of a company's operations and communicating that info to decision
makers
investors - correct answer ✔buy and sell company's stock
creditors - correct answer ✔lend money to a company
managerial accounting - correct answer ✔internal users (managers)
financial accounting - correct answer ✔measure business activities and communicate to external users
2 roles of accountants - correct answer ✔measure and communicate
What is another word for common stock? - correct answer ✔share
limited liability - correct answer ✔prevents stockholders from being held personally responsible for
financial obligations of corporation
corporation - correct answer ✔company that is legally separate from its owners
sole proprietorship - correct answer ✔owned by 1 person
, partnership - correct answer ✔owned by 2 or more people
financing activitites - correct answer ✔transactions that a company has with investors and creditors
investing activities - correct answer ✔transactions involving purchase and sale of resources that are
expected to benefit company for several years
operating activities - correct answer ✔transactions relating primarily to main operations of a
company-- providing products and services to customers and costs of doing so (ex. utilities, taxes,
salaries, advertising, rent)
assets - correct answer ✔resources of a company (ex. supplies, inventory, land, building)
liabilities - correct answer ✔amounts owed to creditors (ex. suppliers, workers, utility company, govt,
bank)
stockholders' equity - correct answer ✔owners' claims to resources
accounting equation - correct answer ✔assets= liabilities + stockholders' equity
valuation - correct answer ✔value of a company equals the total resources minus amounts owed to
creditors
revenue - correct answer ✔amount earned from selling products or services to customers
expense - correct answer ✔cost of providing products and services
answers correctly solved 2025/2026
accounting - correct answer ✔"language of business"
system of maintaining records of a company's operations and communicating that info to decision
makers
investors - correct answer ✔buy and sell company's stock
creditors - correct answer ✔lend money to a company
managerial accounting - correct answer ✔internal users (managers)
financial accounting - correct answer ✔measure business activities and communicate to external users
2 roles of accountants - correct answer ✔measure and communicate
What is another word for common stock? - correct answer ✔share
limited liability - correct answer ✔prevents stockholders from being held personally responsible for
financial obligations of corporation
corporation - correct answer ✔company that is legally separate from its owners
sole proprietorship - correct answer ✔owned by 1 person
, partnership - correct answer ✔owned by 2 or more people
financing activitites - correct answer ✔transactions that a company has with investors and creditors
investing activities - correct answer ✔transactions involving purchase and sale of resources that are
expected to benefit company for several years
operating activities - correct answer ✔transactions relating primarily to main operations of a
company-- providing products and services to customers and costs of doing so (ex. utilities, taxes,
salaries, advertising, rent)
assets - correct answer ✔resources of a company (ex. supplies, inventory, land, building)
liabilities - correct answer ✔amounts owed to creditors (ex. suppliers, workers, utility company, govt,
bank)
stockholders' equity - correct answer ✔owners' claims to resources
accounting equation - correct answer ✔assets= liabilities + stockholders' equity
valuation - correct answer ✔value of a company equals the total resources minus amounts owed to
creditors
revenue - correct answer ✔amount earned from selling products or services to customers
expense - correct answer ✔cost of providing products and services
