1) What are Generally Accepted Accounting Principles (GAAP)? (1 point)

2) Describe the format of the income statement. (1 point)

3) What is an expense? Provide two examples of expenses that can be found on the income statement. (2 points)

4) Review the income statement format. Why is operating income different from net income? (1 point)

5) Explain what is meant by non-operating income and provide an example (1 points)

6) What is an asset? (1 point)

7) What is a liability? (1 point)

8) What is the difference between liabilities and equity (1 point)

9) How do we arrive at the Net Income in an Income Statement? (1 point)

10) What is the basic accounting equation? (1 point)

11) Place the following Balance Sheet entries into the appropriate column. (4 points)

Cash Bonds Payable Long-term Debt

Investments Accounts payable Accounts receivable

Equipment Accrued Expenses