Chp 3 Terms Flashcards
Economic events that require recording in the financial statements
Accounting Transactions
Stockholders’ equity is comprised of two parts:
Common stock, retained earnings
T/F: revenue produced by colorations is much greater than that produced by proprietorships and partnerships.
True
An external user of accounting info is which of the following? A. Marketing manager of company? B. President of labor union C. Officer of corporation D. Production supervisor of the business
B.
Purchasing a delivery truck is what type of activity?
Investing
A business earning revenues is considered to be a:
Operating activity
Borrowing money from a bank is considered to be what type of activity?
Financing
Which of the following are found in an income statement?
- revenues
- cash
- dividends
- expenses
Revenues and expenses
Which of the following accounts will be found on a balance sheet?
- cash
- accounts receivable
- accounts payable
- inventory
- cogs
- common stock
- notes payable
Accounts payable, cash, inventory
If revenues are 20,000 and expenses are 5,000 then the business earn/lost:
Earned $15,000
If revenues are 18,000 and expenses are 22,000 then the business earned or lost
Incurred a net loss of 4,000
If the beginning retained earnings is 10,000, net loss is 3,000 and dividends are 1,000, then the ending retained earnings shown on the statement of retained earnings is :
$6,000
System of collecting and processing transaction data, and communicating them to decision makers is:
Accounting information system
Which is an appropriate date for a balance sheet?
- dec 31, 2015
- for the month ending in dec 31, 2015
- for the quarter ending in December 31, 2015
Dec 31, 2015
The statement which shows the operating, investing, and financing activities of a business is the:
Statement of cash flows
Provides additional details about the items presented in the main body of the financial statements ____________
Notes to the financial statements
A_________ is a separate legal entity owned by stockholders
Corporation
The _____________ statement includes an addition of net income and a deduction of dividends
Restrained earnings
The ability of a company to pay interests as it comes due and to repay the face value of debt at maturity:
Solvency
The constraint of determining whether an item
Is important enough to influence the decision of a reasonably prudent investor or creditor:
Materiality.
