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Mel's Mechanical Repair Shop started the year with total assets of $60,000, total liabilities of $40,000, and retained earnings of $18,000. During the year, the business recorded $100,000 in auto repair revenues, $70,000 in expenses, and the company paid dividends of $15,000. The net income reported by Mel's Mechanical Repair Shop for the year was:

$ 30,000

Which of the four basic financial statements would contain a line item for expenses? Select one: A. Income statement B. Statement of cash flows C. Statement of retained earnings D. Balance sheet

Income statement

Tobias Company purchased inventory on account. This transaction will affect:

Only the balance sheet

The economic resources of an entity that can be usually expressed in monetary terms are called:

Assets

A financial statement either presents information covering a period of time (for example, a month, a quarter, or a year) or it presents information as of a particular date (for example, as of December 31, 2016). Which of the following financial statements presents information as of a particular date?

Balance sheet

Generally accepted accounting principles are:

Guides to action that apply primarily to the process of financial accounting

Which of the following is not a component of the accounting equation?

Income statement

What is the definition of sales revenue?

Increases to a company's resources that result when goods or services are provided to customers

The obligations that an entity must pay in money or services at some time in the future because of past transactions or events are called:

Liabilities

Collected cash from customers that owed a balance due

cash

Adam Vega's Landscaping Company has compiled the following list of account balances of various assets, liabilities, revenues and expenses on December 31, 2016, the end of its first year of operations. Common stock $25,200 Accounts payable 5,000 Salary expense 9,000 Repairs expense 1,600 Dividends 10,000 Truck 17,000 Equipment 12,600 Notes payable 16,400 Cash 35,200 Supplies expense 3,200 Service revenue 43,600 Gasoline expense 1,600 The net income for Adam Vega's Landscaping for the year was:

$28,200

Mel's Mechanical Repair Shop started the year with total assets of $60,000, total liabilities of $40,000, and retained earnings of $18,000. During the year, the business recorded $100,000 in auto repair revenues, $70,000 in expenses, and the company paid dividends of $15,000. Mel's balance of retained earnings at the end of the year was:

$33,000

David Bash's Landscaping Company has compiled the following list of account balances of various assets, liabilities, revenues and expenses on December 31, 2016, the end of its first year of operations. Common stock $50,400 Accounts payable 10,000 Salary expense 18,000 Repairs expense 3,200 Dividends 20,000 Truck 34,000 Equipment 25,200 Notes payable 32,800 Cash 70,400 Supplies expense 6,400 Service revenue 87,200 Gasoline expense 3,200 The total liabilities for David Bash's Landscaping on December 31, 2016 are:

42,800

Which of the following is true? Select one: A credit will increase a revenue account A credit will increase an asset account A debit will decrease an expense account A debit will increase a liability account

A credit will increase a revenue account

Provided services on account

Accounts receivable

Which of the following accounts has a normal debit balance? Select one: Notes Payable Advertising Expense Common Stock Accounts Payable

Advertising Expense

When invoices are sent to customers billing them for services that have been performed, the correct transaction analysis is:

Debit Accounts Receivable and credit Service Fees Earned

Paying a previously recorded invoice from a supplier (of supplies) involves:

Debiting Accounts Payable and crediting Cash

Recording the collection of accounts receivable from customers involves:

Debiting Cash and crediting Accounts Receivable

Recording a stock issuance in exchange for cash involves:

Debiting Cash and crediting Common Stock

Recording the borrowing of money for which a note is signed involves:

Debiting Cash and crediting Notes Payable

Recording the payment of dividends to shareholders involves:

Debiting Dividends and crediting Cash

What is the definition of expenses?

Decreases in a company's resources that a firm incurs in the process of earning revenues

Which of the following accounts is increased by a credit? Select one: Advertising Expense Accounts Receivable Sales Revenue Dividends

Sales Revenue

Which one of the following is not an external user of financial information? Select one: A. Senior company management B. Stockholders C. Internal Revenue Service D. Creditors

Senior company management

A trial balance that balances is useful because it indicates with certainty that: Select one: A. All entries into accounts during the period were made correctly. B. All accounts have normal balances. C. Total debits in the general ledger equal total credits. D. All of the above

Total debits in the general ledger equal total credits.

Issued common stock for cash

cash