Financial Accounting Quiz 1

define dividend

the distribution of the net income of a corporation to its owners

which organization has been entrusted with the development of generally accepted accounting principles (GAAP)?

the financial accounting standards board (FASB)

which of the following items is reported as part of the stockholders' equity on a classified balance sheet? unearned revenue, common stock, accounts payable, or land

common stock

Been There Used Furniture began operations on jan 1, current year, with an initial investment of 100,000 from each of its five stockholders. during the year, the company had net income of 200,000 and paid dividends of 50,000. if the company's revenues were 500,000 for the year ended dec 31, current year, how much were total expenses? 250,000, 800,000, 350,000, 300,000

300,000

define operating activities

cash flows that are directly related to earning income

what is the primary objective of financial reporting? to help creditors evaluate their decision to make loans to a company, to help the investors assess the future prospects of a company, to help management make appropriate decisions related to company operations, or all of these

all of them

what is the name for a person who lends funds to a business entity and expects repayment of the funds with interest?

creditor

the cost of resources used to earn revenues during a period is called

expenses

what is the name of the branch of accounting concerned with providing external decision-makers with information to assess the amounts, timing, and uncertainties of the company's future cash flows?

financial accounting

identify the category of the statement of cash flows that reports the cash flows related to obtaining capital for a company

financing activities

business engage in which of the following three main activities?

financing, investing, and operating

which of the following is not a form of a business organization? sole proprietorship, corporation, governmental agency, partnership

governmental agency

which one of the following users of accounting information would be interested in knowing a company's prospects of making future dividend payments? labor union, governmental agencies, investors, or suppliers

investors

define expenses

the cost of resources used to earn revenues of a business

which one of the following is an internal user of financial information? government agencies, company management, investors, or creditors

company management

how is working capital calculated?

current assets - current liabilities

which statement summarizes the results of the company's operations?

income statement

resources that provide a benefit over a number of years and lack physical substance are classified as what?

intangible assets

list the activities included on the statement of cash flows

investing, operating, and financing activities

what financial statement reports information helpful in assessing working capital?

balance sheet

which financial statement reports an entity's financial position at a specific date?

balance sheet

which of the following groups is considered an internal user of financial statements?

managers of the company that supervises production workers

how is net profit margin calculated?

net income/ sales revenue

which of the following invests funds into a business and is considered an owner?

stockholders

which one of the following is not an external user of the financial statements of a company? stockholders, creditors, the company's president, or its

the company's president