Concept Check 1 resources are items owed to a creditor are items owned by a company represents owners' claims to company Expenses: Revenues; Net income Expenses: Revenues: Stockholders' equity Liabilities; Assets; Stockholders' equity Liabilities, Assets; Net income 2. Under accounting, revenues are recorded when eamed and expenses are recorded with related revenues. Under accounting, revenues are recorded when cash is received and expenses are recorded when cash is paid out. Financial statements are prepared using accounting cash-basis; accrual-basis, accrual basis cash-basis: accrual-basis, cash-basis accrual-basis, cash-basis, cash-basis accrual-basis, cash-basis, accrual-basis 3. The _retains the power and authority to set accounting standards. Currently, this responsibility has been delegated to the Securities and Exchange Commission: International Accounting Standards Board Interational Accounting Standards Board: Financial Accounting Standards Board Securities and Exchange Commission, Financial Accounting Standards Board Financial Accounting Standards Board; Securities and Exchange Commission 4. In what order are the four primary financial statements prepared? 0 0 Statement of stockholders' equity > Income statement > Balance sheet > Statement of cash flows Balance sheet > Income statement > Statement of cash flow=> Statement of stockholders' equity Income statement > Statement of stockholders' equity > Balance sheet > Statement of cash flows Income statement > Balance sheet > Statement of stockholders' equity > Statement of cash flows 5. The difference between net income and dividends paid is known as what? Addition to retained eamings Ending balance in retained earnings Gross profit Total stockholders' equity