1: One way to increase the current ratio is by:

a. buying treasury stock with cash

b. issuing common stock for cash

c. collecting cash on accounts receivable

d. buying equipment with cash

2. The concept of __________ says that accounting information should be objective and not subject to bias.

a. consensus

b. reliability

c. conservatism

d. relevance

3. Consider this journal entry. Which statement is false?

10-31-20 Sales Revenue $251,000

Other Revenue 37,000

Retained Earnings 20,000

Cost of Goods Sold Expense $216,000

Salaries Expense 43,000

S, G & A Expense 30,000

Income Tax Expense 19,000

a. expenses are less than revenues

b. retained earnings is decreased for the amount of net loss

c. revenues will be $0 and expenses will be $0 after this journal entry

d. this is a closing journal entry

4. Assume Company R makes a credit sale to Company S. Which combination is true?

Company R Company S

1. Has accounts receivable, sales revenue //has accounts receivable, sales revenue
2. Has accounts receivable, sales revenue //has accounts payable, inventory
3. Has accounts payable, inventory //has accounts receivable, sales revenue
4. Has accounts payable, inventory //has accounts payable, inventory