Following is a list of account balances of Surburban Lawn Services as of December 31 of the first year of operation Accounts Receivable $4,000 Accounts Payable 6,000 Salaries Expense 7,000 Repairs Expense 600 Truck 10,000 Equipment 9,000 Notes Payable 8,300 Cash 7,200 Supplies Expense 1,500 Service Revenue 31,000 Gasoline Expense 3,100 Salaries Payable 300 What […]
The net income of Edwards Corporation amounted to $73,000 for this year. The beginning balance of stockholders’ equity was $30,000 and the ending balance was $70,000. The company issued no common stock during the year What was the amount of dividends distributed during the year? A) $70,000 B) $33,000 C) $143,000 D) $30,000 ANSWER B […]
Which of the following transactions will affect the balance of Retained Earnings? A) issued common stock for cash B) paid rent expense for the month C) purchased land for cash D) collection on account ANSWER B
In a statement of retained earnings, decreases in retained earnings result from ________. A) issuance of stock B) net losses C) net income D) revenues earned ANSWER B
Which of the following statements best defines financial statements? A) Financial statements are the information systems that record monetary and nonmonetary business transactions. B) Financial statements are the verbal statements made to business news organizations by chief financial officers. C) Financial statements are documents that report on a business in monetary terms, providing information to […]
The amount of net income is transferred from ________ to ________. A) the income statement; the statement of retained earnings B) the balance sheet; the statement of cash flows C) the balance sheet; the income statement D) the income statement; the statement of expenditures ANSWER A
Financial statements are business documents used to communicate information needed to make business decisions. Indicate whether the statement is true or false ANSWER TRUE
Which of the following financial statements shows the dividends distributed to stockholders? A) Income statement B) Statement of retained earnings C) Budgeted balance sheet D) Balance sheet ANSWER B
Which of the following is the correct order of preparation of financial statements? A) Income statement ↑ statement of retained earnings ↑ balance sheet ↑ statement of cash flows B) Statement of retained earnings ↑ balance sheet ↑ income statement ↑ statement of cash flows C) Balance sheet ↑ statement of retained earnings ↑ income […]
Which of the following appears on both the income statement and statement of retained earnings? A) Ending stockholders’ equity B) Total revenues C) Net income D) Dividends ANSWER C
