Discussion Questions and Critical Thinking/Ethical Case-1

1. What are the six functions of accounting?

2. Define, compare, and contrast sole proprietorships, partnerships, and corporations.

3. What type of businesses would you see in industry.

4. Why are ethics important in accounting?

5. List the three elements of the basic accounting equation.

6. Define capital.

7. The total of the left-hand side of the accounting equation must equal the total of the right-hand side. True or false? Please explain.

8. A balance sheet tells a company where it is going and how well it will perform. True or false? Please explain.

9. Revenue is an asset. True or false? Please explain.

10. Into what four categories is owner's equity subdivided?

11. A withdrawal is a business expense. True or false? Please explain.

12. As expenses increase and revenue remains the same, they cause owner's equity to increase. Defend or reject this statement.

13. What does an income statement show?

14. The statement of owner's equity calculates only ending withdrawals. True or false? Please explain.

15. Paul Kloss, accountant for Lowe & Co., travelled to Vancouver on company business. His total expenses came to $350. Paul felt that since the trip extended over the weekend, he could pad his expense account with an additional $100 of expenses. After all, weekends represent his own time, not the company's. What would you do? Write your specific recommendations to Paul