1. The purpose of the income statement is to show the:

A) Change in fair value of the assets from the prior income statement

B) market value per share of stock at the date of the statement

C) only the revenues collected

D) net income or net loss for the period covered by the statement

2. Which of the following types of accounting is primarily used by those within the organization and is often used for planning purposes?

A)	Financial Accounting

B)

Auditing

C)	Managerial Accounting

D)	Income Tax Accounting

3. Retained earnings represents:

A)	the amount invested in the entity by the stockholders

B)	cash is available for dividends

C)	cumulative new income that has not been distributed to stockholders as dividends

D)	par value of common stock outstanding

4. On December 31, an entity's balance sheet showed total assets of $750 and liabilities of $250. Stockholders equity at December 31 was:

A)

$500

B)

$1,000

C)

$750

D)

$250

5. The going concern concept refers to a presumption that:

A)	the entity will be profitable in the coming year

B)	the entity will not be involved in a merger within a year

C)	the entity will continue to operate in the foreseeable future

D)	top management of the entity will not change in the coming year

6. If the company is using the accrual method of accounting, when is revenue recorded?

A)	when cash is received

B)	when customers are issued an estimate

C)	when services are rendered, even though cash may be received at a later date

D)	when assets are purchased

7. In accounting, the matching principle means to match which of the following?

A)	revenues to assets

B)	revenues to expenses

C)	expenses to assets

D)	expenses to liabilities

8. Which of the following is the accounting equation?

A)	Assets + Liabilities= Stockholder's Equity

B)	Assets= Liabilities + Stockholders Equity

C)	Assets/Revenue = Expenses

D)	Liabilities + Expenses= Stockholders Equity

9. Net Income is $75,000. Beginning retained earnings is $32,000 and ending retained earnings is $60,000. What was the amount of dividends paid?

A)

$25,900

B)

$1,000

C)

$29,000

D)

$47,000

10. Which of the following is (are) a category for securities?

	Trading
	Held to maturity
	Available for sale
	All of these

11. When a firm uses the LIFO inventory cost flow assumption:

A)	cost of goods sold will be greater than if FIFO were used

B)	net income will be greater than if FIFO were used

C)	cost of goods sold will be the same as if LIFO were used

D)	better matching of revenue and expense is achieved than under FIFO

12. Accounts receivable are reported at:

	net realizable value
	historical cost
	weighted average cost
	market value

13. An accounts receivable results from the sale of:

A)	property, plant, and equipment for cash

B)	goods and services to customers on account

C)	goods and services to customers for cash

D)	the firm's common stock

14. Which of the following is not an asset?

	A)Cash
	B) Accounts Payable
	C)Accounts Receivable
	D)Equipment

15. Which of the following inventory accounting systems has been made much more feasible as a result of computer systems development?

A)

Periodic

B)

Physical

C)

Perpetual

D)	Just in time

16.The principle challenge to calculating depletion is estimating:

A)	the cost of the asset

B)	the salvage value of the exploration equipment

C)	the demand for the product

D)	the quantity of material to be recovered

Top of Form

17. Non-current, intangible assets such as leasehold improvements, patents, and copyrights are all subject to:

A)	depreciation

B)	amortization

C)

depletion

D)	consolidation

18.Which depreciation method results in equal depreciation expense amounts for each year of an asset's useful life

A)	Units of production

B)	straight line

C)	double-declining balance

D)	MACRS

19. Which of the following is not an example of a source document?

A)	purchase invoice

B)	cash register tape print out

C)	Chart of Accounts

D)	Check stub

20.Which of the following is not a liability?

A)	accounts payable

B)	notes payable

C)

land

D)

salary payable

2. Which of the following types of accounting is primarily used by those within the organization and is often used for planning purposes?

A)	Financial Accounting

B)

Auditing

C)	Managerial Accounting

D)	Income Tax Accounting

3. Retained earnings represents:

A)	the amount invested in the entity by the stockholders

B)	cash is available for dividends

C)	cumulative new income that has not been distributed to stockholders as dividends

D)	par value of common stock outstanding

4. On December 31, an entity's balance sheet showed total assets of $750 and liabilities of $250. Stockholders equity at December 31 was:

A)

$500

B)

$1,000

C)

$750

D)

$250

5. The going concern concept refers to a presumption that:

A)	the entity will be profitable in the coming year

B)	the entity will not be involved in a merger within a year

C)	the entity will continue to operate in the foreseeable future

D)	top management of the entity will not change in the coming year

6. If the company is using the accrual method of accounting, when is revenue recorded?

A)	when cash is received

B)	when customers are issued an estimate

C)	when services are rendered, even though cash may be received at a later date

D)	when assets are purchased

7. In accounting, the matching principle means to match which of the following?

A)	revenues to assets

B)	revenues to expenses

C)	expenses to assets

D)	expenses to liabilities

8. Which of the following is the accounting equation?

A)	Assets + Liabilities= Stockholder's Equity

B)	Assets= Liabilities + Stockholders Equity

C)	Assets/Revenue = Expenses

D)	Liabilities + Expenses= Stockholders Equity

9. Net Income is $75,000. Beginning retained earnings is $32,000 and ending retained earnings is $60,000. What was the amount of dividends paid?

A)

$25,900

B)

$1,000

C)

$29,000

D)

$47,000

10. Which of the following is (are) a category for securities?

	Trading
	Held to maturity
	Available for sale
	All of these

11. When a firm uses the LIFO inventory cost flow assumption:

A)	cost of goods sold will be greater than if FIFO were used

B)	net income will be greater than if FIFO were used

C)	cost of goods sold will be the same as if LIFO were used

D)	better matching of revenue and expense is achieved than under FIFO

12. Accounts receivable are reported at:

	net realizable value
	historical cost
	weighted average cost
	market value

13. An accounts receivable results from the sale of:

A)	property, plant, and equipment for cash

B)	goods and services to customers on account

C)	goods and services to customers for cash

D)	the firm's common stock

14. Which of the following is not an asset?

	A)Cash
	B) Accounts Payable
	C)Accounts Receivable
	D)Equipment

15. Which of the following inventory accounting systems has been made much more feasible as a result of computer systems development?

A)

Periodic

B)

Physical

C)

Perpetual

D)	Just in time

16.The principle challenge to calculating depletion is estimating:

A)	the cost of the asset

B)	the salvage value of the exploration equipment

C)	the demand for the product

D)	the quantity of material to be recovered

Top of Form

17. Non-current, intangible assets such as leasehold improvements, patents, and copyrights are all subject to:

A)	depreciation

B)	amortization

C)

depletion

D)	consolidation

18.Which depreciation method results in equal depreciation expense amounts for each year of an asset's useful life

A)	Units of production

B)	straight line

C)	double-declining balance

D)	MACRS

19. Which of the following is not an example of a source document?

A)	purchase invoice

B)	cash register tape print out

C)	Chart of Accounts

D)	Check stub

20.Which of the following is not a liability?

A)	accounts payable

B)	notes payable

C)

land

D)	salary payable