Question
Every adjustment entry affects: at least one permanent account and one temporary account. only a permanent account. only a temporary account. only a revenue account.
Every adjustment entry affects:
at least one permanent account and one temporary account. | ||
only a permanent account. | ||
only a temporary account. | ||
only a revenue account. |
2 points
QUESTION 2
The owner of a corporation is called a:
partner. | ||
stockholder. | ||
director. | ||
manager. |
2 points
QUESTION 3
When a corporation is owned by a few persons or by a family, it is called a:
closely held corporation. | ||
publicly held corporation. | ||
partnership. | ||
sole proprietorship. |
2 points
QUESTION 4
A distribution of cash to stockholders of a publicly held corporation is called:
net profit. | ||
dividend. | ||
revenue. | ||
interest. |
2 points
QUESTION 5
The process of preparing and closing the accounts of an organization for an accounting period is called a/an:
journal entry. | ||
posting entry. | ||
adjusting entry. | ||
closing entry. |
2 points
QUESTION 6
The adjusting entry for supplies should be:
debit supplies expenses, credit supplies. | ||
debit supplies, credit supplies expenses. | ||
debit sales, credit prepaid insurance. | ||
debit supplies, credit expenses. |
2 points
QUESTION 7
The second part of stockholder equity is called:
retained earnings. | ||
revenue. | ||
net loss. | ||
net capital. |
2 points
QUESTION 8
How many financial statements do corporations prepare?
Four | ||
Five | ||
Two | ||
Three |
2 points
QUESTION 9
The Income Statement of a merchandising business has:
five sections. | ||
four sections. | ||
two sections. | ||
three sections. |
2 points
QUESTION 10
The operating income is an excess of:
gross profit over operating expenses. | ||
gross loss over operating expenses. | ||
gross profit over cost of merchandise sold. | ||
operating expenses over gross profit. |
2 points
QUESTION 11
An analysis that reports each dollar amount in a financial statement as a percentage of another amount is called:
vertical analysis. | ||
horizontal analysis. | ||
percentage analysis. | ||
financial statement analysis. |
2 points
QUESTION 12
A statement that reports the changes in the retained earnings accounts during an accounting period is called the:
statement of changes in owner's equity. | ||
statement of retained earnings. | ||
statement of income. | ||
statement of stockholders' account. |
2 points
QUESTION 13
Which statement classifies activities as operating, investing, or financing?
Income statement | ||
Cash flow statement | ||
Statement of retained earning | ||
Statement of stockholders |
2 points
QUESTION 14
Which account should you debit to close the net loss of a merchandise business?
Operating income account | ||
Retained earnings account | ||
Stockholders account | ||
Income Statement Account |
2 points
QUESTION 15
The maximum number of shares a corporation may issue is called:
authorized capital stock. | ||
preferred stock. | ||
equity stock. | ||
issued stock. |
2 points
QUESTION 16
Match the terms in column I with the descriptions in Column II.
Match the terms in column I with the descriptions in Column II.
comparability
horizontal analysis
vertical analysis
base period
preferred stock
authorized capital stock
earnings distributions
proxy
statements of stockholders' equity
cost of goods sold
A.
legal form to transfer voting rights
B.
comparison of the same items for two or more accounting periods
C.
accounting information to be compared between two fiscal periods
D.
preference over common stock
E.
the maximum number of shares a corporation may issue
F.
changes in all stockholders' equity accounts
G.
period used for comparison
H.
cost of goods sold
I.
dividends
J.
relationship of items from one period to another
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