©BRAINBARTER EXAM SOLUTIONS 2024/2025
ALL RIGHTS RESERVED.
ACCT5101 Midterm Study Guide.
Chapter 1 - answer✔Accounting Concepts
Asset - answer✔Probable future economic benefits
Examples of Assets - answer✔Cash, accounts receivable, supplies, inventory, land, patents
Liabilities - answer✔Probable future sacrifices of economic benefits
Examples of Liabilities - answer✔Payables, loans, unearned revenues
Equity - answer✔Residual interest in the assets of an entity, remains after deducting liabilities
from assets (Stockholder's Equity)
Investments by Owners - answer✔Increase in net assets of an entity
Transfers of value or increases in ownership interests or equity of a firm
Examples of Investments by Owners - answer✔Common stock, paid-in capital
Distributions to Owners - answer✔Decreases in net assets of an entity resulting from
transferring assets, rendering services, or incurring liabilities by the entity to owners
Examples of Distributions to Owners - answer✔Dividends
1|Page
, ©BRAINBARTER EXAM SOLUTIONS 2024/2025
ALL RIGHTS RESERVED.
Comprehensive Income - answer✔Change in equity (net assets) of an entity during a given
period and includes all revenue and gains, expenses and losses than affect net income or
stockholder's equity
Revenues - answer✔Inflows or other enhancements of assets or settlements of liabilities during
a period
Expenses - answer✔Outflows or other using up of assets or incurrences of liabilities (or a
combo of both)
Gains - answer✔increases in equity (net assets) from peripheral or incidental transactions, and
from all other transactions excluding revenues and investments by owners
Losses - answer✔Decreases in equity (net assets) from peripheral or incidental transactions,
and from all other transactions excluding expenses and distributions to owners
Chapter 2 - answer✔Accounting Information System
Objective of Financial Reporting - answer✔To provide financial information about a company
that is useful to present and potential equity investors, lenders, and other creditors for capital
allocation decision making
Double-entry Accounting - answer✔The recording of both debits and credits for every
transaction and ensuring they are equal
DEALOR (acronym) - answer✔Debits
2|Page
ALL RIGHTS RESERVED.
ACCT5101 Midterm Study Guide.
Chapter 1 - answer✔Accounting Concepts
Asset - answer✔Probable future economic benefits
Examples of Assets - answer✔Cash, accounts receivable, supplies, inventory, land, patents
Liabilities - answer✔Probable future sacrifices of economic benefits
Examples of Liabilities - answer✔Payables, loans, unearned revenues
Equity - answer✔Residual interest in the assets of an entity, remains after deducting liabilities
from assets (Stockholder's Equity)
Investments by Owners - answer✔Increase in net assets of an entity
Transfers of value or increases in ownership interests or equity of a firm
Examples of Investments by Owners - answer✔Common stock, paid-in capital
Distributions to Owners - answer✔Decreases in net assets of an entity resulting from
transferring assets, rendering services, or incurring liabilities by the entity to owners
Examples of Distributions to Owners - answer✔Dividends
1|Page
, ©BRAINBARTER EXAM SOLUTIONS 2024/2025
ALL RIGHTS RESERVED.
Comprehensive Income - answer✔Change in equity (net assets) of an entity during a given
period and includes all revenue and gains, expenses and losses than affect net income or
stockholder's equity
Revenues - answer✔Inflows or other enhancements of assets or settlements of liabilities during
a period
Expenses - answer✔Outflows or other using up of assets or incurrences of liabilities (or a
combo of both)
Gains - answer✔increases in equity (net assets) from peripheral or incidental transactions, and
from all other transactions excluding revenues and investments by owners
Losses - answer✔Decreases in equity (net assets) from peripheral or incidental transactions,
and from all other transactions excluding expenses and distributions to owners
Chapter 2 - answer✔Accounting Information System
Objective of Financial Reporting - answer✔To provide financial information about a company
that is useful to present and potential equity investors, lenders, and other creditors for capital
allocation decision making
Double-entry Accounting - answer✔The recording of both debits and credits for every
transaction and ensuring they are equal
DEALOR (acronym) - answer✔Debits
2|Page
