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Exam 1: An Introduction to Accounting

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Question 51

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Which of the following is not an example of an asset use transaction?

A) Paying cash dividends
B) Paying cash expenses
C) Paying off the principal of a loan
D) Paying cash to purchase land

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Question 52

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The following business events occurred for Ringgold Company during Year 1, its first year in operation: 1. Issued stock to investors for $45,000 cash2. Borrowed $25,000 cash from the local bank3. Provided services to its customers and received $32,000 cash4. Paid expenses of $28,0005. Paid $22,000 cash for land6. Paid dividend of $12,000 to stockholders7. Repaid $10,000 of the loan listed in item 2 Required:a)Show the effects of the above transactions on the accounting equation, below. Include dollar amounts of increases and decreases. Enter "NA" for elements of the accounting equation that are not affected by the transaction. If one element of the accounting equation is affected by an increase and also by a decrease, enter each part on a separate line (i.e. asset exchange transaction where one asset increases and another asset decreases). (The effects of the first transaction is shown below.)b)After entering all the events, calculate the total amounts of assets, liabilities, and equity at the end of the year.

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Question 53

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Which of the following cash transactions would not affect total assets?

International accounting standards are formulated by the IASB. What does that acronym stand for?

What does a company's statement of cash flows tell you about the company?

Net income appears on which of the following financial statements?

Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.) 1) Acquired $950 cash from the issue of common stock.2) Borrowed $420 from a bank.3) Earned $650 of revenues.4) Paid expenses of $250.5) Paid a $50 dividend. During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.) 1) Issued an additional $325 of common stock.2) Repaid $220 of its debt to the bank.3) Earned revenues of $750.4) Incurred expenses of $360.5) Paid dividends of $100. The amount of assets on Packard's Year 2 balance sheet is

What is meant by the term stockholders' equity?

Borrowing cash from the bank is an example of which type of transaction?

Kelly Company experienced the following events during its first accounting period. (1) Issued common stock for $10,000 cash. (2) Earned $8,000 of cash revenue. (3) Paid $1,000 cash to purchase land. (4) Paid cash dividends amounting to $500. (5) Paid $4,400 of cash expenses. Based on this information the amount of net income is

If total stockholder's equity is $150,000 and liabilities are $75,000, what are total assets?

Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.) 1) Acquired $1,050 cash from the issue of common stock.2) Borrowed $520 from a bank.3) Earned $750 of revenues.4) Paid expenses of $270.5) Paid a $70 dividend. During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.) 1) Issued an additional $425 of common stock.2) Repaid $290 of its debt to the bank.3) Earned revenues of $850.4) Incurred expenses of $400.5) Paid dividends of $120. The amount of assets on Packard's Year 2 balance sheet is

During Year 2, Chico Company earned $2,750 of cash revenue, paid $1,200 of cash expenses, and paid a $700 cash dividend to its owners. Based on this information alone, which of the following statements is not true?

Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.) 1) Acquired $950 cash from the issue of common stock.2) Borrowed $420 from a bank.3) Earned $650 of revenues.4) Paid expenses of $250.5) Paid a $50 dividend. During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.) 1) Issued an additional $325 of common stock.2) Repaid $220 of its debt to the bank.3) Earned revenues of $750.4) Incurred expenses of $360.5) Paid dividends of $100. What is the net cash inflow from operating activities that will be reported on Packard's statement of cash flows for Year 1?

The types of resources needed by a business are financial, physical, and labor resources.

Yowell Company began operations on January 1, Year 1. During Year 1, the company engaged in the following cash transactions: 1) issued stock for $74,0002) borrowed $59,000 from its bank3) provided consulting services for $72,0004) paid back $32,000 of the bank loan5) paid rent expense for $17,5006) purchased equipment costing $29,0007) paid $4,700 dividends to stockholders8) paid employees' salaries for work completed during the year, $38,000 What is Yowell's net cash flow from operating activities?

Jack Henry borrowed $800,000 from Walt Bank to open a new bike store called Wooden Wheels. Jack transferred $650,000 of the cash he borrowed to Wooden Wheels on the first day of the year. Which of the following appropriately reflects the cash transactions between these reporting entities?

Each of the following requirements is independent of the others. a)Valdez Corporation has liabilities of $95,000 and stockholders' equity of $115,000. What is the amount of Valdez's assets? ________b)Global Company has assets of $320,000 and liabilities of $95,000. What is the amount of Global's stockholders' equity? ________c)Brown Company has assets of $90,000 and liabilities of $25,000. What is the amount of Brown's claims? ________

Which of the following is not an element of the financial statements?

Which of the following are shown on the balance sheet? Total assetsLandCommon StockNet Change in CashRevenueNotes PayableRetained EarningsTotal Liabilities and Stockholders' EquityExpensesNet IncomeBeginning cash balanceDividends