Quiz 3 and 4 Flashcards
The ending Retained Earnings balance of ABC decreased by $1.5 million from the beginning of the year. The company declared a dividend of $4.4 million during the year. What was the net income for the year?
2.9 Million
Which of the following is not possible when recording a transaction?
Liabilities increase and assets decrease.
Consider the following transactions:
1) Issued common stock for cash.
2) Purchased equipment by signing a note payable.
3) Provided services to customers on account.
4) Collected cash from customers on account.
How many of these four transactions increased the given company’s total liabilities?
1
Consider the following transactions:
1) Issued common stock for cash.
2) Purchased equipment by signing a note payable.
3) Provided services to customers on account.
4) Collected cash from customers on account.
How many of these four transactions increased the given company’s total assets?
2
The following table contains financial information for ABC before closing entries:
Cash
$23,000
Common Stock
34,000
Supplies
4,000
Advertising Expense
2,000
Accounts Payable
20,000
Service Revenue
30,000
Salaries Expense
3,000
Prepaid Rent
4,000
Dividends
3,000
Equipment
45,000
How many of the above accounts are permanent?
6
The primary focus for financial accounting information is to provide information useful for:
Investment decisions and credit decisions
Consider the following transactions:
1) Issued common stock for cash.
2) Purchased equipment by signing a note payable.
3) Provided services to customers on account.
4) Collected cash from customers on account.
How many of these four transactions increased the given company’s total liabilities?
1
One of the three condition of an asset is that an accountant can _____________ the asset.
measure
A company provides services on account. Indicate how this transaction would affect (1) assets, (2) stockholders’ equity, and (3) revenues.
(1) Increase, (2) Increase (3) Increase
Of the following, the most important objective for financial accounting is to provide information useful for:
Predicting cash flows
The two groups who have claims on the Assets in a business are (3 words, second word is and)
Creditors and owners
On September 30, ABC paid employee salaries of $7,000, including $1,000 it owed to its employees last month. What are the effects of this transaction on the accounting equation?
Assets decreased, liabilities decreased, and expenses increased
Consider the following account balances of ABC at the end of the year:
Accounts Payable
$4,400
Salaries Expense
12,800
Cash
1,700
Common Stock
2,400
Service Revenue
8,300
Supplies
4,300
Retained Earnings
1,100
Utilities Expense
5,000
How many of these accounts would appear in ABC’s year-end balance sheet?
5
Which of the following is not a balance sheet item?
Revenues
Assets
Common stock
Retained earnings
1 - Revenues
What is the amount of current assets, assuming the accounts above reflect normal activity? (just type in numbers)
Accounts Payable
$12,000
Buildings
70,000
Cash
8,000
Accounts Receivable
7,000
Sales Tax Payable
5,000
Retained Earnings
47,000
Supplies
2,000
Notes Payable (due in 18 months)
35,000
Interest Payable
3,000
Common Stock
45,000
17000
Accounts Receivable + Cash + Supplies
ABC had the following final balances after the first year of operations:
assets, $55,000; stockholders' equity, $25,000; dividends, $3,000; net income, $10,000. What is the amount of ABC's liabilities? (just type numbers)
30000
Executory Contracts are generally
not recorded
In a three line heading, the first line is the:
Company name
Owners’ Equity is
Just a number not a thing
Which of the following transactions would cause an increase in both the assets and liabilities of a company?
Purchase of a building by issuing a note payable.
When a company provides services on account, the accounting equation would be affected as follows:
Assets increase and stockholders’ equity increases.
When a company pays cash for equipment, what is the effect on the accounting equation for that company?
No change
One of the three conditions for an asset is that the business __________ the asset
owns
The following financial information is from ABC. All debt is due within one year unless stated otherwise.
Retained Earnings
$52,000
Supplies
37,000
Equipment
72,000
Accounts Receivable
8,600
Deferred Revenue
6,000
Accounts Payable
15,000
Common Stock
25,000
Notes Payable (due in 18 months)
35,000
Interest Payable
7,000
Cash
22,400
What is the amount of current liabilities? (just type numbers)
28000
Given the following, stockholders’ claims to the company’s resources amount to: (If your number is 12,345 do not put in $ or commas, just type 12345)
Assets
$1,200,000
Liabilities
$800,000
Net income
$100,000
Retained earnings
$250,00
400000
