What is the differences among the four basic financial statements?

ACCT 2331 Chapter 1 Problem Shells BE1-3 Match each form of business organization with its description. Business Organizations Descriptions 1. Sole proprietorship a. Business owned by two or more persons. 2. Partnership b. Entity legally separate from its owners. 3. Corporation c. Business owned by a single person. BE1-4 Match each account type with its description. Account Classificati ons Descriptions 1 Assets . a. sales of products or services. 2 Liabilities . b. Owners' claims to resources. 3 Stockholders' . equity c. Distributions to stockholders. 4 Dividends . d. Costs of selling products or services. 5 Revenues . e. Resources of a company. 6 Expenses f. Amounts owed. . BE1-5 For each transaction, indicate whether each account would be classified in the balance sheet as (a) an asset, (b) a liability, or (c) stockholders' equity; in the income statement as (d) a revenue or (e) an expense; or in the statement of stockholders' equity as (f) a dividend. Account Accounts Classifications Related Transactions 1. Rent expense Cost of rent. 2. Interest revenue Interest earned on savings account. 3. Dividends Cash payments to stockholders. 4. Land Land used for operations. 5. Accounts payable Amounts owed to suppliers. BE1-7 Match each financial statement with its description. Financial Statements Related Transactions 1 Income . statement a Change in owners' claims to resources. . 2 Statement of b Profitability of the company. . stockholders' . equity c. Change in cash as a result of operating, 3 Balance investing, and financing activities. . sheet d Resources equal creditors' and owners' 4 Statement of . claims to those resources. . cash flows BE1-8 Determine on which financial statement you find the following items. Financial Statements 1 Income . statement 2 Statement of . stockholders' equity 3 Balance sheet . 4 Statement of . cash flows Items a The change in retained . earnings due to net income and dividends. b Amount of cash received . from borrowing money from a local bank. c. Revenue from sales to customers during the year. d Total amounts owed to . workers at the end of the year. BE1-9 Each of these parties plays a role in the quality of financial reporting. Match each group with its function. Groups Functions 1 Financial . Accountinga Group that has been given power by Standards . Congress to enforce the proper Board application of financial reporting rules 2 International for companies whose securities are . Accounting publicly traded. Standards b Independent, private-sector group that Board . is primarily responsible for setting financial reporting standards in the 3 Securities and United States. . Exchange Commission c. Independent intermediaries that help to ensure that management 4 Auditors appropriately applies financial . reporting rules in preparing the company's financial statements. d Body that is attempting to develop a . single set of high-quality, understandable global accounting standards. E1-1 The following provides a list of transactions and a list of business activities. Transactions Business Activities 1 Borrow from the bank. . a Financing . 2 Provide services to customers. . b Investing . 3 Issue common stock to . investors. c. Operating 4 Purchase land. . 5 Pay rent for the current period. . 6 Pay dividends to stockholders. . 7 Purchase building. . Required: Match the transaction with the business activity by indicating the letter that corresponds to the appropriate business activity. E1-2 Falcon Incorporated has the following transactions with Wildcat Corporation. Transactions Falcon's Related Account 1. Falcon purchases common stock of Wildcat. Investment 2. Falcon borrows from Wildcat Notes payable by signing a note. 3. Wildcat pays dividends to Dividend revenue Falcon. 4. Falcon provides services to Wildcat. Service revenue 5. Falcon pays interest to Wildcat on borrowing. Interest expense Required: 1 For each transaction, indicate whether Falcon would classify each . account in the balance sheet as (a) an asset, (b) a liability, or (c) stockholders' equity; in the income statement as (d) a revenue or (e) an expense; or in the statement of stockholders' equity as (f) a dividend. 2 Classify the type of activity as financing, investing, or operating. . E1-4 Eagle Corp. operates magnetic resonance imaging (MRI) clinics throughout the Northeast. At the end of the current period, the company reports the following amounts: Assets = $50,000; Liabilities = $27,000; Dividends = $3,000; Revenues = $14,000; Expenses = $9,000. Required: 1 Calculate net income. . Revenues - Expenses = Net Income 2 Calculate stockholders' equity at the end of the period. . Assets = Liabilities + Stockholders' Equity E1-6 Below are the account balances for Cowboy Law Firm at the end of December. Accounts Cash Balances $5,400 Salaries expense 2,200 Accounts payable 3,400 Retained earnings 3,900 Utilities expense 1,200 Supplies 13,800 Service revenue 9,300 Common stock 6,000 Required: Use only the appropriate accounts to prepare an income statement. Cowboy Law Firm Income Statement For the _______Ended December 31, 2xxx Revenues - Expenses = Net Income E1-8 Wolfpack Construction has the following account balances at the end of the year. Accounts Balances Equipment $26,000 Accounts payable 3,000 Salaries expense 33,000 Common stock 11,000 Land 18,000 Notes payable 20,000 Service revenue 39,000 Cash 6,000 Retained earnings ? Required: Use only the appropriate accounts to prepare a balance sheet. ASSETS Cowboy Law Firm Balance Sheet As of December 31, 2xxx LIABILITIES & STOCKHOLDERS' EQUITY