Test 1 on Chapter 1&2 Financial ACCTg 4A- 43448

The accounting equation for Quattro Enterprises is as follows: Assets Liabilities Stockholders' Equity $120,000 = $60,000 + $60,000 If Quattro purchases office equipment on account for $15,000, the accounting equation will change to AssetsLiabilitiesStockholders' Equity

$135,000 = $75,000 + $60,000

Black Keys Company began the year with stockholders' equity of $185,000. During the year, the company recorded revenues of $250,000, expenses of $190,000, and paid dividends of $20,000. What wasBlack Keys' stockholders' equity at the end of the year?

$225,000.

If total assets equal $345,000 and total stockholders' equity equal $120,000, then total liabilities must equal

$225,000.

Mofro's Computer Repair Shop started the year with total assets of $270,000 and total liabilities of $180,000. During the year, the business recorded $450,000 in computer repair revenues, $270,000 in expenses, and Mofro paid dividends of $45,000. Stockholders' equity at the end of the year was

$225,000.

During February 2014 its first month of operations, the owner of Ariel Pink Enterprises invested cash of $25,000. Ariel had cash revenues of $5,000 and paid expenses of $7,000. Assuming no othertransactions impacted the cash account, what is the balance in Cash at February 28?

$23,000 debit

If total liabilities increased by $15,000 and stockholders' equity increased by $10,000 during a period of time, then total assets must change by what amount and direction during that same period?

$25,000 increase

Chik Chik Company showed the following balances at the end of its first year:Cash $ 3,000Prepaid insurance 4,700Accounts receivable 3,500Accounts payable 2,800Notes payable 4,200Common stock 1,400Dividends 700Revenues 22,000Expenses 17,500What did Chik Chik Company show as total credits on its trial balance?

$30,400

In the first month of operations, the total of the debit entries to the cash account amounted to $900 and the total of the credit entries to the cash account amounted to $600. The cash account has a(n)

$300 debit balance

During 2013, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $33,000. The business paid dividends of $20,000. What is the amount of stockholders' equityat December31, 2019?

$7,000 credit

The Duce Company has five plants nationwide that cost a total of $100 million. The current fair value of the plants is $500 million. The plants will be recorded and reported as assets at

100 mil

An awareness of the normal balances of accounts would help you spot which of the following as an error in recording?

A credit balance in an expense account

An accountant has debited an asset account for $1,200 and credited a liability account for $500. What can be done to complete the recording of the transaction?

Credit a different asset account for $700.

Devendra Company pays cash dividends of $600. The entry for this transaction will include a debit of $600 to

Dividends

Net income results when

Revenues > Expenses

Which of the following journal entries is recorded correctly and in the standard format?

Salaries and Wages Expense 500Advertising Expense 1,000 Cash . 1,500

Which of the following would not be considered an internal user of accounting data for the GHI Company?

President of the employees' labor union

Owners enjoy limited liability in a

corporation

Martin Corporation purchased land in 2007 for $290,000. In 2013, it purchased a nearly identical parcel of land for $460,000. In its 2013 balance sheet, Martin valued these two parcels of land at a combined value of $920,000. By reporting the land in this manner, Martin Corp. has violated the

cost principle

The left side of an account is

debit side

Deerhoof Company purchases equipment for $1,700 and supplies for $400 from Milkman Co. for $2,100 cash. The entry for this transaction will include a

debit to Equipment $1,700 and a debit to Supplies $400 for Deerhoof.

When assets are distributed to the owners of a corporation, these distributions are termed

dividends.

The entire group of accounts maintained by a company is called the

general ledger

The first step in solving an ethical dilemma is to

identify ethical concerns.

Accounting consists of three basic activities which are related to economic events of an organization. These include

identifying, recording, and communicating

The economic entity assumption requires that the activities

of an entity be kept separate from the activities of its owner

An income statement

presents the revenues and expenses for a specific period of time.

The final step in the recording process is to

transfer journal information to ledger accounts.

Collection of a $1,000 Accounts Receivable

increases an asset $1,000; decreases an asset $1,000

When you credit a liability account

indicates an increase in the amount owed to creditors

The name given to entering transaction data in the journal is

journalizing.

As of December 31, 2013, Calexico Company has assets of $37,000 and stockholders' equity of $20,000. What are the liabilities for Calexico Company as of December 31, 2013?

$17,000

At January 31, 2014, the balance in Aislers Inc.'s supplies account was $250. During February, Aislers purchased supplies of $300 and used supplies of $375. At the end of February, the balance in thesupplies account should be

$175 debit.

Mofro's Computer Repair Shop started the year with total assets of $270,000 and total liabilities of $180,000. During the year, the business recorded $450,000 in computer repair revenues, $270,000 inexpenses, and Mofro paid dividends of $45,000. The NET INCOME reported by Mofro's Computer Repair Shop for the year was

$180,000

At January 1, 2014, Alligator Industries reported retained earnings of $130,000. During 2014, Alligator had a net loss of $30,000 and paid dividends of $15,000. At December 31, 2014, the amount ofretained earnings is

$85,000

Which of the following correctly identifies normal balances of accounts?

Assets Debit Liabilities Credit Stockholders' Equity Credit Revenues Credit Expenses Debit

Which account below is not a subdivision of Stockholders Equity?

Common stock

GAAP stands for

Generally Accepted Accounting Principles.

Which of the following would not be considered an external user of accounting data for the GHI Company?

Management.

A debit is not the normal balance for which account listed below?

Service Revenue

January 14, Edamame Industries purchased supplies of $700 on account. The entry to record the purchase will include

a debit to Supplies and a credit to Accounts Payable