1 Japeth's statement of changes in owner's equity shows net income of $25,000, owner's drawings of $5,000 and an ending balance of $65,000.

What was Japeth's beginning balance?

a $70,000

b $95,000

c $45,000

d $65,000

2.Instances of fraud and misconduct caused the government to implement which piece of legislation?

a)General Accepted Accounting Principles

b)International Financial Reporting Standards

c)Sarbanes-Oxley Act

d)Miller-Townsend Act

3.Which of the following concerning unearned revenues is NOT true?

a)They are recorded as a revenue account entry.

b)Adjusting entries are made at the end of a period to report unearned revenues.

c)They are found on a balance sheet.

d)They are receipts for services or products that will be performed or delivered at a future date.

4 Nancy received $5,000 cash from her credit union to fund the remodeling of her store.

Which kind of activity on a statement of cash flows does this exemplify?

a)Capital activity

b)Operating activity

c)Investing activity

d)Financing activity

5. An auditor's role is which of the following?

a)To report a company's financial standing to external sources

b)To assist a company's management team with decision-making

c)To document all of a company's monetary transactions

d)To objectively analyze a company's accounting data

6. Which of the following scenarios would use a purchases subsidiary ledger?

a)Maybelle wants to know which customers have been late on their payments.

b)Trudy wants to know which suppliers have raised their prices in the past year.

c)Ann Marie wants to determine whether to extend more credit to a customer.

d)John wants to identify his top 20 customers.