For Week 2, please turn in the answers to the following questions:

1.Define the process of accounting.

2.What are the three major divisions in the accounting field?

3.What is the Fundamental Accounting Equation?

4.What is the purpose of a balance sheet?What are some examples of typical balance sheet accounts?

5.What is the purpose of an income statement?What are some examples of typical income statement accounts?

6.What is the purpose of a statement of cash flows?What are some examples of typical statement of cash flow accounts?

7.Based on the financial information below, develop a income statement and a balance sheet for Joe's-Fly-by-Night Oil company for the year ended December 31, 2015.Unless otherwise indicated, assume all information below is either for the year 2015 or as of December 31, 2015.

Accounts receivable......................................... $3,000

Accumulated depreciation................................. $12,000

Cost of goods sold.......................................... $4,000

Income tax expense.........................................$1,000

Cash........................................................... $10,000

Sales........................................................... $20,000

Equipment (gross)........................................... $27,000

Selling, general, & administrative expenses............. $3,000

Common stock (1,000 shares)..............................$7,000

Accounts payable........................................... $17,000

Retained earnings........................................... $13,000

Interest expense.............................................$200

Inventory..................................................... $17,000

Long-term debt..............................................$8,000

Dividends declared and paid.............................. $600