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| 1 | |
Amounts that a business must pay in the future are known as |
| | A) | accounts receivable. |
| | B) | accounts payable. |
| | C) | capital. |
| | D) | expenses. |
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| 2 | |
Examples of assets are |
| | A) | cash and accounts receivable. |
| | B) | cash and revenue. |
| | C) | cash and rent expense. |
| | D) | investments by the owner and revenue. |
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| 3 | |
A net loss results |
| | A) | when expenses are greater than revenue. |
| | B) | when assets are greater than liabilities. |
| | C) | when revenue is greater than expenses. |
| | D) | when expenses are greater than assets. |
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| 4 | |
The income statement shows |
| | A) | the financial position of a business on a specific date. |
| | B) | revenue and owner's equity. |
| | C) | the results of operations for a period of time. |
| | D) | the total value of the business. |
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| 5 | |
If the income statement covered a six-month period ending on November 30, 20--, the third line of the income statement heading would read |
| | A) | Month Ended November 30, 20--. |
| | B) | November 30, 20--. |
| | C) | Six-month Period Ended November 30, 20--. |
| | D) | Month of November, 20--. |
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| 6 | |
When the owner invests cash in a business, |
| | A) | assets and revenue increase. |
| | B) | assets increase and owner's equity decreases. |
| | C) | liabilities decrease and owner's equity increases. |
| | D) | assets and owner's equity increase. |
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| 7 | |
When equipment is purchased on credit, |
| | A) | assets and liabilities increase. |
| | B) | assets increase and liabilities decrease. |
| | C) | assets and owner's equity increase. |
| | D) | assets and expenses increase. |
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| 8 | |
When equipment is purchased for cash, |
| | A) | assets decrease and expenses increase. |
| | B) | one asset increases and another asset decreases. |
| | C) | assets and owner's equity increase. |
| | D) | assets increase and liabilities decrease. |
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| 9 | |
When the owner withdraws cash for personal use, |
| | A) | assets decrease and expenses increase. |
| | B) | assets decrease and owner's equity increases. |
| | C) | assets decrease and owner's equity decreases. |
| | D) | owner's equity decreases and revenue decreases. |
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| 10 | |
When the owner writes a company check to pay the firm's electric bill, |
| | A) | assets and owner's equity increase. |
| | B) | assets decrease and expenses increase. |
| | C) | assets and liabilities decrease. |
| | D) | expenses increase and owner's equity increases. |
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