Accounting chapter 1 Homework flash cards

Question 1

Investors in common stock

Answer 1

Trying to determine if the company’s net income will result in a stock price increase

Question 2

Marketing Managers

Answer 2

Trying to determine if a company’s advertising proposal will be cost effective

Question 3

creditors

Answer 3

trying to determine if a company will pay its obligations

Question 4

Chief Financial Officer

Answer 4

trying to determine if the company should employ debt or equity financing.

Question 5

Internal Revenue Service

Answer 5

Trying to to determine whether the company complied with tax laws.

Question 6

Accounts payable

Answer 6

Liability

Question 7

Accounts Receivable

Answer 7

Asset

Question 8

Equipment

Answer 8

Asset

Question 9

Sales Revenue

Answer 9

Revenue

Question 10

Service Revenue

Answer 10

Revenue

Question 11

Inventory

Answer 11

Asset

Question 12

Mortgage Payable

Answer 12

Liability

Question 13

Supplies Expense

Answer 13

Expense

Question 14

Rent expense

Answer 14

expense

Question 15

Salaries and wages expense

Answer 15

expense

Question 16

cost incurred for advertising

Answer 16

Affects: Expense

Account title: advertising expense

Question 17

cash received for services performed

Answer 17

affects: Revenue

account title: service revenue

Question 18

cost incurred for insurance

Answer 18

affects: expense

account title: insurance expense

Question 19

Amounts paid to employees

Answer 19

affects: expense

account title: salaries and wages expense

Question 20

cash distributed to stockholders

Answer 20

Affects: dividends

account title: not applicable

Question 21

cash received in exchange for allowing the use of the company’s building

Answer 21

affects: Revenue

account title Rent revenue

Question 22

cost incurred for utilities used

Answer 22

affects: expense

account title: utilities expense

Question 23

cash purchase of equipment

Answer 23

affects: does not effect stockholders equity

account title: not applicable

Question 24

cash received from investors

Answer 24

affects: common stock

account title: not applicable

Question 25

Income tax expense

Answer 25

income statement

Question 26

Inventory

Answer 26

Balance sheet

Question 27

Accounts payable

Answer 27

balance sheet

Question 28

retained earnings

Answer 28

balance sheet

Question 29

equipment

Answer 29

balance sheet

Question 30

sales revenue

Answer 30

income statement

Question 31

cost of goods sold

Answer 31

income statement (revenue)

Question 32

common stock

Answer 32

balance sheet

Question 33

accounts receivable

Answer 33

balance sheet

Question 34

interest expense

Answer 34

income statement