ACCOUNTING 200 EXAM 1 2025
QUESTIONS AND ANSWERS
The three types of a business - ANS Service Business
Merchandising Business
Manufacturing Business
Business - ANS An organization that sells goods or services to customers
The four business forms - ANS Proprietorship
Partnership
Corporation
Limited Liability Company
Proprietorship - ANS Owned by one individual
Partnership - ANS Owned by more than one individual or entity (partners)
Corporation - ANS Owned by more than one individual or entity (stockholders)
Limited Liability Company - ANS owned by more than one individual or entity (members)
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, Equation for Net Income - ANS Revenues - Expenses
Revenue - ANS amount the business earned this period
Expenses - ANS costs the business incurred this period in earning revenue
Low-cost emphasis - ANS high volume to make a profit
acceptable quality at low cost
Premium-price emphasis - ANS don't need high volume to make profit
unique qualities at a premium price
Stakeholder - ANS Entities with an interest in a business
Capital market stakeholder - ANS Lenders/creditors
Owners/stockholders
Product/Service Market stakeholder - ANS Suppliers and customers
Government stakeholders - ANS Collect taxes from the business and regulate activities (IRS,
State Tax Boards, OSHA, ADA)
Income Statement - ANS Revenues - Expenses = Net Income
GAAP - ANS Generally Accepted Accounting Principles
The four financial statements required of businesses
Copyright ©2025 BRIGHTSTARS ALL RIGHTS RESERVED 2
QUESTIONS AND ANSWERS
The three types of a business - ANS Service Business
Merchandising Business
Manufacturing Business
Business - ANS An organization that sells goods or services to customers
The four business forms - ANS Proprietorship
Partnership
Corporation
Limited Liability Company
Proprietorship - ANS Owned by one individual
Partnership - ANS Owned by more than one individual or entity (partners)
Corporation - ANS Owned by more than one individual or entity (stockholders)
Limited Liability Company - ANS owned by more than one individual or entity (members)
Copyright ©2025 BRIGHTSTARS ALL RIGHTS RESERVED 1
, Equation for Net Income - ANS Revenues - Expenses
Revenue - ANS amount the business earned this period
Expenses - ANS costs the business incurred this period in earning revenue
Low-cost emphasis - ANS high volume to make a profit
acceptable quality at low cost
Premium-price emphasis - ANS don't need high volume to make profit
unique qualities at a premium price
Stakeholder - ANS Entities with an interest in a business
Capital market stakeholder - ANS Lenders/creditors
Owners/stockholders
Product/Service Market stakeholder - ANS Suppliers and customers
Government stakeholders - ANS Collect taxes from the business and regulate activities (IRS,
State Tax Boards, OSHA, ADA)
Income Statement - ANS Revenues - Expenses = Net Income
GAAP - ANS Generally Accepted Accounting Principles
The four financial statements required of businesses
Copyright ©2025 BRIGHTSTARS ALL RIGHTS RESERVED 2
