1. The main objective for all businesses is to maximize unrealized profits.

True

False

2. About 90% of the businesses in the United States are organized as corporations.

True

False

3. The Financial Accounting Standards Board (FASB) is the authoritative body that has primary responsibility for developing accounting principles.

True

False

4. Generally accepted accounting principles regulate how and what financial information is reported by businesses.

True

False

5. If total assets increased by $190,000 during a specific period and liabilities decreased by $10,000 during the same period, the period's change in total stockholders' equity was a $200,000 increase.

True

False

6. An account receivable is typically classified as a revenue.

True

False

7.Dividends paid to stockholders decrease assets and increase equity.

True

False

8. Assets that are used up during the process of earning revenue are called expenses.

True

False

9. The primary financial statements of a corporation are the income statement, the statement of stockholders equity, and the balance sheet.

True

False

10. A statement of stockholders equity reports the changes in stockholder's equity for a period of time.

True

False

11. The balance sheet represents the accounting equation.

True

False

12. Profit is the difference between?

assets and liabilities

the incoming cash and outgoing cash

the assets purchased with cash contributed by the owner and the cash spent to operate the business

the amounts received from customers for goods or services and the amounts paid for

the inputs used to provide the goods or services