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Exam 1: Introduction to Accounting and Business

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Question 21

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The assets and liabilities of S&P Day Spa at December 31, 2011, and its revenue and expenses for the year are listed below. The Retained Earnings balance was $57,830 at January 1, 2011. Based on the data provided for S&P Day Spa, prepare an income statement for the year ended December 31, 2011.

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Question 22

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If the liabilities owed by a business total $300,000 and owner's equity is equal to $300,000, then the assets also total $300,000.

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Question 23

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The main objective for all businesses is to maximize unrealized profits.

Select the type of business that is most likely to obtain large amounts of resources by issuing stock.

Debts owed by a business are referred to as

Explain the meaning of the business entity concept.

The main objective of a not-for-profit business is to make a profit.

Selected transaction data of a business for September are summarized below. Determine the following amounts for September: (a) total revenue, (b) total expenses, (c) net income.

The assets and liabilities of S&P Day Spa at December 31, 2011, and its revenue and expenses for the year are listed below. The Retained Earnings balance was $57,830 at January 1, 2011. Based on the data provided for S&P Day Spa, prepare a balance sheet as of December 31, 2011.

Accounting information users need reports about the economic activities and condition of businesses.

Determine the missing amount for each of the following:

Match the following accounts to the financial statement where they can be found. (Hint: Some of the accounts can be found in more than one financial statement.)

If total assets decreased by $30,000 during a specific period and owner's equity decreased by $35,000 during the same period, the period's change in total liabilities was an $65,000 increase.

Most businesses in the United States are

The business entity concept means that

All of the following statements regarding the ratio of liabilities to stockholders' equity are true except

If a corporation had net income of $60,000 and $20,000 in cash dividends were declared and paid then the retained earnings account would increase by $40,000.

The assets section of the balance sheet normally presents assets in

Given below are the accounts and amounts for Bright Futures Company as of August 31, 2011. All of the revenue and expense amounts are for the month of August. Based on the data provided for Bright Futures Company, prepare in good format a balance sheet as of August 31, 2011.

Which of the following is true in regards to a Limited Liability Company?