practice acc 210 final
C
An advantage of the corporate form of business is that A. it has limited life B. its owners' personal resources are at stake C. its ownership is easily transferable via the sale of shares of stock D. it is simple to establish E. it has double taxation
A
Cost allocation of an intangible asset is referred to as: A. amortization B. depreciation C. accretion D. capitalization E. depletion
C
External users want answers to all of the following questions except? A. is the company earning satisfactory income? B. will the company be able to pay debts as they come due? C. will the company be able to afford employee pay raises this year? D. how does the company compare in profitability with competitors?
B
Retained earnings at the end of the period is equal to: A. beginning RE plus net income minus liabilities B. beginning RE plus net income minus dividends C. net income D. assets plus liabilities E. assets minus liabilities
B
Simple interest differs from compound interest in that: A. simple interest is computed at the end of the life of the investment B. simple interest is computed on the principal balance only C. simple interest is the inverse of compound interest D. simple interest must be computed on a daily basis E. simple interest must be paid out annually
D
The best definition of assets is the: A. cash owned by the company B. collections of resources belonging to the company and the claims to those resources C. owners' investment in the business D. resources belonging to a company that have future benefit to the company
A
The double-entry system requires that each transaction must be recorded A. in at least two different accounts B. in two sets of books C. in a journal and in a ledger D. first as a revenue and then as an expense
B
The usual sequence of steps in the transaction recording process is A. journalize, analyze, post to the ledger B. analyze, journalize, post to the ledger C. journalize, post to the ledger, analyze
B
Which of the following describes the classification and normal balance of the retained earnings account? A. asset, debit B. stockholders' equity, credit C. revenues, credit D. expense, debit
B (increase cash and decrease AR)
Wolfpack Inc. collected $6250 on account. The affect on the transaction on the accounting equation is to A. increase revenue and decrease expenses B. have no effect on total assets C. decreases assets and decrease liabilities D. increase assets and increase equity
working capital
________=current assets-current liabilities -answers the question of "after paying our current obligations how much will we have to work with" -a large positive ________ is an indicator of liquidity-whether a company can pay its current debts on time -not good for comparing companies because it doesn't control for the size of each company
current ratio
___________=current assets/current liabilities -a _________ of greater than 1 says there are more CA than CL and this is good. -current assets include: cash, current investments, acct receivables, inventories, and prepaid expenses
current assets
cash, current investments, acct receivables, inventories, and prepaid expenses are examples of ____________