Balance Sheet and Separate Legal Entity
ACCT 1010 Fall 2013 Ch 1 Quiz
Name: __________________________ Date: _____________
1. The proprietorship form of business organization
A) must have at least two owners in most states.
B) generally receives favorable tax treatment relative to a corporation.
C) combines the records of the business with the personal records of the owner.
D) is classified as a separate legal entity.
2. The retained earnings statement would not show
A) the retained earnings beginning balance.
B) revenues and expenses.
C) dividends.
D) the ending retained earning balance.
3. Net income will result during a time period when:
A) assets exceed liabilities.
B) assets exceed revenues.
C) expenses exceed revenues.
D) revenues exceed expenses.
4. Which of the following is not a common way that managers use the balance sheet?
A) To analyze the balances of assets, liabilities, and stockholders' equity throughout the accounting period
B) To determine if the cash balance is sufficient for future needs
C) To analyze the balance between debt and common stock financing
D) To analyze the balance of accounts receivable on the last day of the accounting period
5. A business organized as a separate legal entity is a
A) corporation.
B) proprietor.
C) government unit.
D) partnership.
6. The right to receive money in the future is called a(n)
A) account payable.
B) account receivable.
C) liability.
D) revenue.
7. Gibson Company recorded the following cash transactions for the year:
Paid $180,000 for salaries.
Paid $80,000 to purchase office equipment.
Paid $20,000 for utilities.
Paid $8,000 in dividends.
Collected $300,000 from customers.
What was Gibson's net cash provided by operating activities?
A) $100,000
B) $20,000
C) $120,000
D) $92,000
8. If total liabilities increased by $45,000 and stockholders' equity increased by $15,000 during a period of time, then total assets must change by what amount and direction during that same
Name: __________________________ Date: _____________
1. The proprietorship form of business organization
A) must have at least two owners in most states.
B) generally receives favorable tax treatment relative to a corporation.
C) combines the records of the business with the personal records of the owner.
D) is classified as a separate legal entity.
2. The retained earnings statement would not show
A) the retained earnings beginning balance.
B) revenues and expenses.
C) dividends.
D) the ending retained earning balance.
3. Net income will result during a time period when:
A) assets exceed liabilities.
B) assets exceed revenues.
C) expenses exceed revenues.
D) revenues exceed expenses.
4. Which of the following is not a common way that managers use the balance sheet?
A) To analyze the balances of assets, liabilities, and stockholders' equity throughout the accounting period
B) To determine if the cash balance is sufficient for future needs
C) To analyze the balance between debt and common stock financing
D) To analyze the balance of accounts receivable on the last day of the accounting period
5. A business organized as a separate legal entity is a
A) corporation.
B) proprietor.
C) government unit.
D) partnership.
6. The right to receive money in the future is called a(n)
A) account payable.
B) account receivable.
C) liability.
D) revenue.
7. Gibson Company recorded the following cash transactions for the year:
Paid $180,000 for salaries.
Paid $80,000 to purchase office equipment.
Paid $20,000 for utilities.
Paid $8,000 in dividends.
Collected $300,000 from customers.
What was Gibson's net cash provided by operating activities?
A) $100,000
B) $20,000
C) $120,000
D) $92,000
8. If total liabilities increased by $45,000 and stockholders' equity increased by $15,000 during a period of time, then total assets must change by what amount and direction during that same