Accounting Exam 1

Iventory

Asset

Accounts Receivable

balance sheet

The statement of cash flows reports the ______.

cash collected and cash paid during the period

Equipment

non current asset

Accounts Payable

non-current liability

Cash Collected from Customers

statement of cash flows

Current Ratio Formula

current liabilities/current assets

Notes Payable (due in 3 months)

current liability

Eel Electronics paid $4,000 of the $5,000 its employees had earned during the period. Eel Electronics should report Wages Expense of ______ on the income statement and Wages Payable of ______ on the balance sheet prepared in accordance with generally accepted accounting principles.

$5,000; $1,000

Whistler Company had retained earnings of $456,000 at the end of Year 1. During Year 2, Whistler had net income of $132,000. Retained earnings were $470,000 at December 31, Year 2. The amount of dividends for Year 2 must have been:

118000

Thistle Do Nicely had $100 of supplies on May 1. During May, it purchased $400 of supplies on account. It paid $150 of the $400 it owed for its supplies. At May 31, Thistle Do Nicely only had $25 of supplies left. Supplies on the balance sheet equals ______.

25

Purses, Inc., sold 5 purse(s) that cost $20 each to its customers for a price of $80 each. The Gross Profit amount on the income statement will equal $______.

300

If a company's total assets equals $50,000 and its shareholders' equity equals $10,000, then its liabilities must equal $______.

40,000

During the year, A Salt & Buttery, Inc., had revenue of $90,000 of which $16,000 was collected from customers. It also had expenses of $29,000 of which $3,000 was paid. The owners were paid $20,000 in dividends. Net income for the year equals $______.

61000

Nim Com Soup, Inc., purchased land at a cost of $8,000 five years ago. Currently, the land is estimated to be worth $38,000. At what amount should the land be reported on Nim Com Soups' balance sheet at year end?

8000

Which of these would be reported as cash flows from investing activities? (Select all that apply.)

Cash paid to buy equipment Cash paid to build a new corporate headquarters

If a company borrows money by issuing a note payable at the beginning of the accounting period, as a result, it will report ________.

Interest Expense on the income statement

If a company incorrectly records cash received for services to be provided in the future by increasing Cash and increasing Sales Revenue, how will this error affect net income for the current period?

Net income will be too high.

What is the effect on total liabilities when a company buys land in exchange for a 20-year note payable?

Total liabilities will increase.

The expensing of a long-term asset, such as Equipment, over its useful life causes a(n) ______. (Select all that apply.)

decrease in assets decrease in shareholders' equity

Accounts payable

liability

Bonds Payable

liability

Morris Lest, Inc., purchased machinery for $10,000 cash. The effect of this transaction is to cause ______.

total assets to remain the same