ACCCC

examples of assets

$, equipment, land

If equity is $30,000 and liabilities are $19,000, then assets must equal: (E+L=A)

49000

Sheldon Company had beginning retained earnings of $1,000, net income of $5,000, and dividends of $250. The ending balance in the retained earnings account is

5750

Why does a business need accounting information?

Accounting records business transactions and communicates financial information.

Identify the correct definition of an asset:

An asset is a resource that a business owns or controls

Identify which items belong on the balance sheet.

Cash, accounts receivable, and common stock

Identify which items belong on the statement of retained earnings.

Dividends, beginning retained earnings, ending retained earnings

Describe the order in which a company prepares financial statements.

Income Statement, Statement of Retained Earnings, Balance sheet, Statement of Cash Flow

4 basic financial statements

Income Statement, Statement of retained earnings, Balance sheet, and Statement of cash flows.4

All of the following are part of the FASB conceptual framework: (Select all that apply).

Objectives Recognition and measurement Elements Qualitative characteristics

Which of the following statements below lists the rules of entering transactions into the accounting equation?

The accounting equation must always remain in balance so that assets always equal the sum of liabilities and equity.

When recording transactions into the accounting equation, which of the following statements are correct? (Check all that apply.)

The accounting equation must always remain in balance. After recording the transaction, total assets will always equal total liabilities plus equity.

Which of the following statements explain(s) how the accounting equation applies to businesses? (Check all that apply.)

The equation applies to all transactions and events. The equation reflects that the total of what a business owns at any point in time will equal the total of what it owes creditors and owners. The relation of assets, liabilities and equity is reflected in the equation. The equation states that Assets = Liabilities + Equity.

accounting assumptions

going-concern monetary unit time period business entity

what are assets and what are they composed of

resources, claims (liabilities+equity)

Identify which of the following statements is correct as to why accounting is important.

we live in an information age whereby accounting information impacts everyone

A process of analyzing data to identify meaningful relations and trends is called data

analytics

provides information useful to investors, creditors, etc

objectives

three factors that push a person to commit fraud

opportunity, pressure (incentive), rationalization (attitude)

Mario formed Lupo Company and personally invested $15,000 in the business in exchange for common stock. Lupo Company also paid dividends of $2,000. The company earned $35,000 of revenues and incurred $23,000 of expenses. At the end of the year, the company's equity totaled:

25000

Given the accounts below, choose all of the ones that affect equity

Dividends Revenues Expenses Common Stock.

Identify which items belong on the income statement.

Revenue, expenses and net income

Which of the following statements best represents the accounting equation?

The total of everything owned by a business must always equal the total of what the business owes to creditors and owners.

The statement of retained earnings explains changes in equity from net income (or loss) and from any ______ over a period of time

dividends

nonowners claims?

liabilities

owners claims?

net assets, residual equity, equity (increase with owner investments/revenues, decrease with dividends/expenses)

criteria for elements and measuring them

recognition and measurement

Which of the statement(s) below define(s) an asset? (Check all that apply.)

Resources controlled by the business An amount owned Resources with expected future benefits

An external user of accounting information

does not directly run the organization

defines items in financial statements

elements

beliefs that separate right from wrong

ethics

Happenings that affect the accounting equation Exchanges within an entityInternal transactions

events

transaction

exchange of economic consideration between two parties

A(n) _____ user of accounting information does not directly run the organization.

external

Exchanges of value between two entities

external transaction

Tyler invests $2,000 cash in exchange for common stock, to begin a new company, Tyler's Tayloring. This transaction will:

increase equity by 2000

Exchanges within an entity

internal transactions

4 accounting principles

measurement/cost revenue recognition expense recognition/matching full disclosure

qualitive characteristics

relevance and faithful representation of info

Generally accepted accounting principles (GAAP) wants information to have:

relevance, faithful representation

On January 31, Jean"s Company receives a bill for that month's utilities ($500). Jean sets it aside because she does not plan to pay the bill until its due date of February 15. What effect, if any, does this event have on the company's accounting equation as of January 31?

the business must record this event which would increase liabilities and decrease equity on january 31

What are Generally Accepted Accounting Principles?

the concepts and rules that govern financial accounting practice

A graphical presentation of data to help in understanding their significance is called data

visualization