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What is the balance sheet equation?

Assets = liabilities + shareholders' equity

Which of the following equations correctly shows the relationship between the items on a company's balance sheet?

Assets = liabilities + stockholders' equity

All of the following are considered to be components of cash flow EXCEPT

banking activities

The owners' equity portion of a corporation's balance sheet would contain all of the following except

net income.

A term used to describe the results of subtracting a corporation's liabilities from its assets is

owners' equity.

When reviewing a corporation's financial statements, shareholders' equity is computed by

subtracting total liabilities from total assets.

The total of the cash from operations, investing, and financing, as reported on the statement of cash flows, is

the net change in the cash position of the firm for the reporting period

An analyst wishing to view a good consolidated indicator of a business's cash inflow and outflow would most likely ask look at

the statement of cash flows

One of the components of a cash flow statement is cash flow from investing activities. Included would be

transactions and events involving the purchase and sale of land, buildings, and equipment.

Under SEC rules, Form 8-K must be filed

within 4 business days of the event

Publicly-traded corporations are generally required to have an annual independent audit of their financial records. What is the highest opinion offered under GAAP?

Unqualified opinion

Current assets on a corporate balance sheet would include

cash inventory

If during a given year a company has net income of $1 million and pays out dividends of $800,000, its retained earnings will

increase by $200,000

SSS Corporation's total assets amount to $780,000, of which $260,000 represents current assets. Total liabilities equal $370,000, of which $200,000 is considered long-term or other liabilities. What is SSS Corporation's shareholders' equity?

$410,000.00 - Total assets minus total liabilities equals shareholders' equity ($780,000 − $370,000 = $410,000).

Which of the following statements about balance sheets are TRUE?

1. Balance sheets provide a snapshot of a company's financial position on a given date. 2. Balance sheets represent the relationship between a company's assets, liabilities, and stockholders' equity.

In order to be in compliance with SEC reporting rules, a company will typically file a Form 10-Q how many times during its fiscal year?

3 times

If a publicly traded corporation was going to sell a wholly-owned subsidiary, the information would be made available through the filing of a Form

8-K

Which of the following best describe the balance sheet formula?

Assets minus liabilities equals net worth. Liabilities plus equity equals assets. A balance sheet basically lists what is owned (assets) and what is owed (liabilities). The difference between these 2 is the net worth or equity. Sales, expenses, and dividends are all found on the income statement.

Issuance of which of the following would most likely increase the leverage in a company's capital structure?

Bonds - Leverage is the use of borrowed money. This is reflected in a company's debt-to-equity ratio. Of these choices, the only one that is borrowed money is the bonds.

When a company recognizes a sale only when payment is made, it is using which form of accounting?

Cash

An analyst wishing to check on the most recent financial performance of an SEC-registered issuer would probably examine the

Form 10-Q

When a member of the board of directors of a publicly traded company resigns due to a disagreement over an operational matter,

Form 8-K must be filed with the SEC within 4 business days of the event

Which items change when a company pays a cash dividend?

Total assets Total liabilities

A corporation ends its accounting year on September 30. It would be correct to state that it uses

a fiscal year

When viewing a corporation's balance sheet, you would expect to see all of the following included in owner's equity except

cash - Owners' equity, sometimes referred to as stockholders' equity, is simply the net worth of a corporation. Net worth is the total assets minus the total liabilities. The primary components listed on a balance sheet under owner's equity are the: par value of the outstanding preferred stock; par value of the outstanding common stock; any excess paid in over the par value of the common stock at issuance, known as paid-in capital or paid-in surplus; retained earnings (years ago referred to as earned surplus); and if the company has re-acquired any of its common stock (Treasury stock), the cost of that purchase is subtracted from retained earnings.

When an analyst adds back the current year's depreciation to the net income, she is computing the company's

cash flow from operations

An analyst reviewing a company's financial statements would examine the footnotes to

discover any pending legal action against the company