Accounting

During 2014, Gibson Company assets decreased $50,000 and its liabilities decreased $90,000. Its stockholders' equity therefore: (a) increased $40,000. (b) decreased $140,000. (c) decreased $40,000. (d) increased $140,000.

(a). increased 40,000 (-50,000=-90,000+40,000)

Which statement presents information as of a specific point in time? (a) Income statement. (b) Balance sheet. (c) Statement of cash flows. (d) Retained earnings statement.

(b). balance sheet

(LO 1) The effects on the basic accounting equation of performing services for cash are to: (a) increase assets and decrease stockholders' equity. (b) increase assets and increase stockholders' equity. (c) increase assets and increase liabilities. (d) increase liabilities and increase stockholders' equity.

(b). increase assets and increase stockholders' equity

(LO 4) The financial statements for Joseph Corporation contained the following information. Accounts receivable $ 5,000 Sales revenue 75,000 Cash 15,000 Salaries and wages expense 20,000 Rent expense 10,000 What was Joseph Corporation's net income? (a) $60,000. (b) $15,000. (c) $65,000. (d) $45,000.

(d) 45,000

Which statement about users of accounting information is incorrect? (a) Management is considered an internal user. (b) Taxing authorities are considered external users. (c) Present creditors are considered external users. (d) Regulatory authorities are considered internal users.

(d). Regulatory authorities are considered internal users

(LO 4) Net income will result during a time period when: (a) assets exceed liabilities. (b) assets exceed revenues. (c) expenses exceed revenues. (d) revenues exceed expenses.

(d). Revenues exceed expenses

Stockholders' equity represents: (a) claims of creditors. (b) claims of employees. (c) the difference between revenues and expenses. (d) claims of owners

(d.) Claims of owners

(LO 5) Which financial statement reports assets, liabilities, and stockholders' equity? (a) Income statement. (b) Retained earnings statement. (c) Balance sheet. (d) Statement of cash flows.

©. Balance sheet

The balance in retained earnings is not affected by: (a) net income. (b) net loss. (c) issuance of common stock. (d) dividends.

©. Issuance of common stock