1) Using check marks, identify the financial statement(s) on which each of the following items / accounts appear. Item Income Statement Shareholders Equity Balance Sheet
1) Using check marks, identify the financial statement(s) on which each of the following items / accounts appear.
Item | Income Statement | Shareholders Equity | Balance Sheet | ||
Asset | Liability | Shareholder Equity | |||
Sales Revenue |
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Unearned Revenue |
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Notes Payable |
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Retained Earnings |
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Accounts Receivable |
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Income Tax Expense |
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Pre-paid Rent |
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Land |
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Cash |
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Dividends |
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2) Circle the one correct answer for each of the following two statements:
At the end of Celebrity Imports first year of operations, assets are $750,000 and owners' equity is $680,000.
a. The business liabilities are $70,000.
b. The owner must have invested $750,000 to start the business.
c. The business liabilities are $1,430,000.
d. The business must be operating profitably.
A company pays back $1 million on a loan it had received earlier from a bank,
a. Assets are unchanged, liabilities and stockholders' equity both increased by $1 million.
b. Assets are unchanged, liabilities increase by $1 million, contributed capital decreases by $1 million.
c. Assets decrease by $1 million, liabilities are unchanged, contributed capital decreases by $1 million.
d. Assets decrease by $1 million, liabilities decrease by $1 million, stockholders' equity is unchanged.
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