Sophia Pathways Accounting - Final Milestone

1 Which of the following is a major advantage to forming a corporation? • Lenders of a corporation do not have the right to claim the corporation's assets to pay its debts. • The income from a corporation is not taxed. • Stockholders have limited liability for the debts of the corporation. • A corporation is usually managed by its owners. CONCEPT Businesses and Organizations 2 Which of the principles below does Val follow when she reviews her records to make sure that recorded accounting events correspond to the actual costs? • Full disclosure principle • Time period principle • Measurement principle • Matching principle CONCEPT Conceptual Framework and Principles 3 The employees of Catherine's business earned $22,800 in wages during December, but the next payday is not until January 2nd. When Catherine makes an adjustment on her December 31st trial balance worksheet to account for these wages, what two types of accounts will be affected? • An asset account and an expense account • A payable account and a revenue account. • An expense account and a payable account • Owner's equity and a payable account CONCEPT Creating Adjusting Entries 4 Which of the following is responsible for conducting an independent examination of a company's financial statements and records? • Bookkeeper • Stakeholder • Auditor • Controller CONCEPT Accounting in Practice 5 A car valued at $30,000 has $600 of depreciation to be adjusted as of January 31st. Which entry should be made? • Credit Accumulated Depreciation, Debit Depreciation Expense, both for $600 • Debit Accumulated Depreciation, Credit Car, both for $600 • Debit Accumulated Depreciation, Credit Depreciation Expense, both for $600 • Debit Car, Credit Depreciation, both for $600