QUESTION 1

Elston Company compiled the following financial information as of December 31, 2010 (not in trial balance order): Sales $140,000 Common stock 30,000 Equipment 40,000 Expenses 125,000 Cash 35,000 Dividends 10,000 Inventory 5,000 Accounts payable 20,000 Accounts receivable 15,000 Retained earnings, 1/1/10 75,000 Elstons total liabilities on December 31, 2010 is:

		$15,000
		$20,000
		$80,000
		$ 5,000

4 points

QUESTION 2

Elston Company compiled the following financial information as of December 31, 2010: Sales $140,000 Common stock 30,000 Equipment 40,000 Expenses 125,000 Cash 35,000 Dividends 10,000 Inventory 5,000 Accounts payable 20,000 Accounts receivable 15,000 Retained earnings, 1/1/10 75,000 Elstons total assets on December 31, 2010 is:

		$235,000
		$170,000
		$ 80,000
		$ 95,000

4 points

QUESTION 3

Elston Company compiled the following financial information as of December 31, 2010: Sales $140,000 Common stock 30,000 Equipment 40,000 Expenses 125,000 Cash 35,000 Dividends 10,000 Inventory 5,000 Accounts payable 20,000 Accounts receivable 15,000 Retained earnings, 1/1/10 75,000 Elstons balance of retained earnings on December 31, 2010 is:

		$15,000
		$90,000
		$80,000
		$ 5,000

4 points

QUESTION 4

Elston Company compiled the following financial information as of December 31, 2010: Sales $140,000 Common stock 30,000 Equipment 40,000 Expenses 125,000 Cash 35,000 Dividends 10,000 Inventory 5,000 Accounts payable 20,000 Accounts receivable 15,000 Retained earnings, 1/1/10 75,000 Elstons stockholders equity on December 31, 2010 is:

		$105,000
		$110,000
		$ 80,000
		$120,000

4 points

QUESTION 5

On a classified balance sheet, accounts receivable is classified as

		an intangible asset.
		property, plant, and equipment.
		a current asset.
		a long-term investment.

4 points

QUESTION 6

A current asset is

		the last asset purchased by a business.
		an asset which is currently being used to produce a product or service.
		usually found as a separate classification in the income statement.
		expected to be converted to cash or used in the business within the operating cycle, which is usually 12 months of the balance sheet date.

4 points

QUESTION 7

Which of the following is not a current liability?

		Wages payable
		Accounts payable
		Taxes payable
		Note payable due in four years

4 points

QUESTION 8

These are selected account balances on December 31, 2010 for Sigma Corp. Land $100,000 Corporate Office Building 600,000 Inventory 200,000 Equipment 150,000 Office Furniture 100,000 What is the total amount of property, plant, and equipment that will appear on the balance sheet?

		$1,050,000
		$1,150,000
		$850,000
		$950,000

4 points

QUESTION 9

Debit and credit can be interpreted to mean bad and good, respectively.

True

False

4 points

QUESTION 10

K2 Corporation has assets of $1.35 million, common stock of $351,000, and retained earnings of $214,000. What are the creditors claims on their assets? (Hint: a "creditor" is someone the company owes money to.)

		$1,213,000
		$ 565,000
		$ 785,000
		$1,487,000

4 points

QUESTION 11

Stockholders equity is increased by

		dividends.
		revenues.
		expenses.
		liabilities.

4 points

QUESTION 12

Collection of a $600 Accounts Receivable

		increases an asset $600; decreases an asset $600.
		increases an asset $600; decreases a liability $600.
		decreases a liability $600; increases stockholders equity $600.
		decreases an asset $600; decreases a liability $600.

4 points

QUESTION 13

When collection is made on Accounts Receivable,

		total assets will remain the same.
		stockholders equity will increase.
		total assets will increase.
		total assets will decrease.

4 points

QUESTION 14

When a dividen is paid in cash, the impact is

		a decrease in assets and stockholders equity.
		an increase in assets and stockholders equity.
		an increase in assets and a decrease in stockholders equity.
		a decrease in assets and an increase in stockholders equity.

4 points

QUESTION 15

The journal is a chronological record of all transactions.

True

False

4 points

QUESTION 16

Budke Corporation paid dividends of $5,000. As a result of this event,

		The dividends account was debited for $5,000.
		The dividends account was credited for $5,000.
		The cash account was debited for $5,000.
		Both b and c.

4 points

QUESTION 17

Which pair of accounts follows the rules of debit and credit in the same manner?

		Common Stock and Rent Expense
		Repair Expense and Notes Payable
		Accounts Receivable and Advertising Expense
		Sales and Equipment

4 points

QUESTION 18

When a company receives an electric bill but will not be paying it right away, it should

		debit Utilities Expense and credit Accounts Receivable.
		debit Accounts Payable and credit Utilities Expense.
		debit Utilities Expense and credit Accounts Payable.
		None of the above. No entry should be made until the electric bill is paid

4 points

QUESTION 19

The authoritative body currently responsible for establishing accounting standards for U.S. public and private companies is the

		Internal Revenue Service
		Securities and Exchange Commission
		American Institute of CPAs
		Financial Accounting Standards Board

4 points

QUESTION 20

Which of the following does NOT reflect financial activity over a period of time?

		Balance Sheet
		Income Statement
		Statement of Retained Earnings
		None of the above. All of the above reflect financial activitiy over a period of time.

4 points

QUESTION 21

Which of the following is NOT normally organized in financial statement account sequence?

		Journal
		General Ledger
		Trial Balance
		Balance Sheet

4 points

QUESTION 22

When a sale is made on credit which of the following is increased?

		Accounts Receivable
		Sales
		Cost of Goods Sold
		Both 1 & 2.

4 points

QUESTION 23

Budke Corporation paid dividends of $5,000. As a result of this event,

		The dividends account was debited for $5,000.
		The dividends account was credited for $5,000.
		The cash account was debited for $5,000.
		Both b and c.

4 points

QUESTION 24

The authoritative body currently responsible for establishing accounting standards for U.S. public and private companies is the

		Internal Revenue Service
		Securities and Exchange Commission
		American Institute of CPAs
		Financial Accounting Standards Board

4 points

QUESTION 25

Which of the following is NOT normally organized in financial statement account sequence?

		Journal
		General Ledger
		Trial Balance
		Balance Sheet