Accounting 200 Exam 1; Questions & Answers
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account payable Correct answer-a liability backed by the general reputation and credit
standing at the debtor.
accounting Correct answer-the information system that measures business activities,
processes that information into reports and financial statements, and communicates the results
to decision makers.
accounting equation Correct answer-assets=liabilities+owners equity
asset Correct answer-an economic resource that is expected to be of benefit in the
future.
balance sheet Correct answer-list of an entity's assets, liabilities, and owner's equity as of
a specific date. also called the statement of financial position.
board of directors Correct answer-group elected by the stockholders to set policy for a
corporation and to appoint its officers.
capital Correct answer-another name for the owner's equity of a business
cash Correct answer-money and any medium of exchange that a bank accepts at face
value.
, Accounting 200 Exam 1; Questions & Answers
100% Verified
common stock Correct answer-the most basic form of capital stock.
continuity (going concern) assumption Correct answer-holds that the entity will remain in
operation for the foreseeable future.
corporation Correct answer-a business owned by stockholders. It is a legal entity, an
"artificial person" in the eyes of the law.
current asset Correct answer-an asset that is expected to be converted to cash, sold, or
consumed during the next 12 months or within the business's normal operating cycle if longer
than a year.
current liability Correct answer-a debt due to be paid within one year or within the
entity's operating cycle if the cycle is longer than a year.
deficit Correct answer-negative balance in retained earnings caused by net losses over a
period of years.
dividends Correct answer-distributions (usually cash) by a corporation to its stockholders.
100% Verified
account payable Correct answer-a liability backed by the general reputation and credit
standing at the debtor.
accounting Correct answer-the information system that measures business activities,
processes that information into reports and financial statements, and communicates the results
to decision makers.
accounting equation Correct answer-assets=liabilities+owners equity
asset Correct answer-an economic resource that is expected to be of benefit in the
future.
balance sheet Correct answer-list of an entity's assets, liabilities, and owner's equity as of
a specific date. also called the statement of financial position.
board of directors Correct answer-group elected by the stockholders to set policy for a
corporation and to appoint its officers.
capital Correct answer-another name for the owner's equity of a business
cash Correct answer-money and any medium of exchange that a bank accepts at face
value.
, Accounting 200 Exam 1; Questions & Answers
100% Verified
common stock Correct answer-the most basic form of capital stock.
continuity (going concern) assumption Correct answer-holds that the entity will remain in
operation for the foreseeable future.
corporation Correct answer-a business owned by stockholders. It is a legal entity, an
"artificial person" in the eyes of the law.
current asset Correct answer-an asset that is expected to be converted to cash, sold, or
consumed during the next 12 months or within the business's normal operating cycle if longer
than a year.
current liability Correct answer-a debt due to be paid within one year or within the
entity's operating cycle if the cycle is longer than a year.
deficit Correct answer-negative balance in retained earnings caused by net losses over a
period of years.
dividends Correct answer-distributions (usually cash) by a corporation to its stockholders.
