Corresponds to CLO 1(a) Which of the following interrelationships is not important to understand when preparing financial statements: (Points : 8) Total payments on the balance sheet should equal the...

Co
esponds to CLO 1(a) Which of the following inte
elationships is not important to understand when
preparing financial statements: (Points : 8)
Total payments on the balance sheet should equal the cash payments for operating activities on
the statement of cash flows.
Net income from the income statement is used in the retained earnings statement.
The ending retained earnings from the retained earnings statement is used in the stockholders'
equity section of the balance sheet.
The cash on the balance sheet should be equal to the cash at the end of the period on the
statement of cash flows.
2. Co
esponds to CLO 1(b) Which of the following does not describe the balance sheet? (Points : 8)
The balance sheet presents a picture at a point in time of what a business owns and owes.
The balance sheet reports the assets, liabilities, and stockholders' equity at a specific date.
The balance sheet reports the changes in assets, liabilities, and stockholders' equity over a period
of time.
The balance sheet reports assets and claims to those assets at a specific point in time.
3. Co
esponds to CLO 1(c) Tulsa Corporation began the year by issuing $50,000 of common stock for
cash. The company recorded revenues of $200,000, expenses of $125,000, and paid dividends of
$20,000. What was Tulsa's net income for the year? (Points : 8)
$75,000
$105,000
$55,000
$200,000
4. Co
esponds to CLO 1(d) Which of the following is not true about the statement of cash flows? (Points
: 8)
The statement of cash flows provides information about a company's cash receipts and cash
payments.
Ending cash on the statement of cash flows should equal cash shown on the balance sheet.
The statement of cash flows is prepared in order to determine the cash balance to be used on the
alance sheet.
The statement of cash flows shows the amount of cash provided or used by operating activities,
investing activities, and financing activities.
5. Co
esponds to CLO 2(a) Based on the following account balances, what is the total of the debit and
credit columns of this company's adjusted trial balance? Service Revenue…$5,000; Cash…$1,600;
Unearned revenue…$3,600; Salary expense…$1,300; Common stock…$1,000; Equipment…$7,000;
Prepaid insurance…$1,400; Depreciation expense…$700; Accumulated depreciation…$1,400; Retained
earnings…$1,000. (Points : 8)
$8,600
$11,300
$12,000
$17,000
6. Co
esponds to CLO 2(b) Given the following adjusted trial balance amounts, what is the net income
for the year?
Debit balances
Cash…$8,000; Accounts receivable…$4,000; Short-term investments…$10,000; Prepaid rent…$500;
Property, plant, & equipment…$20,000; Salary expense…$6,000; Depreciation expense…$2,000; Rent
expense…$2,500
Credit balances
Accumulated depreciation…$6,000; Accounts payable…$2,600; Unearned revenue…$3,000; Common
stock…$8,000; Retained earnings…$12,000; Service revenue…$21,000; Interest revenue…$400. (Points
: 8)
$7,900
$11,400
$10,400
$10,900
7. Co
esponds to CLO 2(c) Given the following adjusted trial balance amounts, what is the retained
earnings ending balance to be reported on the statement of retained earnings?
Debit balances
Cash…$8,000; Accounts receivable…$12,000; Inventory…$13,000; Property, plant, &
equipment…$30,000; Cost of goods sold…$21,000; Salary expense…$4,000; Depreciation
expense…$3,000
Credit balances
Accumulated depreciation…$9,000; Accounts payable…$5,000; Common stock…$35,000; Retained
earnings…$12,000; Revenue…$30,000. (Points : 8)
$12,000
$14,000
$10,000
$17,000
8. Co
esponds to CLO 2(d) Given the following adjusted trial balance amounts, total assets reported on
the balance sheet is?
Debit balances
Cash…$15,000; Accounts receivable…$12,000; Equipment…$60,000; Supplies…$4,000;
Expenses…$95,000.
Credit balances
Accumulated depreciation…$6,000; Accounts payable…$5,000; Common stock…$40,000; Retained
earnings…$15,000; Revenue…$120,000. (Points : 8)
$85,000
$91,000
$125,000
$81,000
9. Co
esponds to CLO 3(a) Intuition Company provided consulting services and billed the client $4,000.
As a result of this transaction, (Points : 8)
assets increased by $4,000
equity increased by $4,000
assets and equity remained unchanged.
both a and b.
10. Co
esponds to CLO 3(b) Delbert Industries purchased and received inventory of $15,000 on
account. The entry to record this purchase will include: (Points : 8)
a debit to Inventory and a credit to Accounts Payable.
a debit to Inventory expense and a credit to Accounts Receivable.
a debit to Accounts Payable and a credit to Inventory.
a debit to Inventory and a credit to Cash.
11. Co
esponds to CLO 3(c) During June 2013, its first month of operations, the owner of Jinx
Enterprises invested cash of $25,000 in Jinx Enterprises. Jinx had cash sales of $8,000, bought supplies
of $600 on account, and paid expenses of $12,500. Assuming no other transactions impacted the cash
account, what is the balance in Cash at June 30. (Points : 8)
$20,500 debit
$20,500 credit
$19,900 debit
$19,900 credit
12. Co
esponds to CLO 3(d) Hemmingway Corporation paid salaries of $5,000 and paid advertising
expense of $2,000. Which of the following journal entries co
ectly records these expenses? (Points : 8)
Debit: Cash $7,000
Credit: Salaries/Wages Expense$5,000
Credit: Advertising Expense $2,000
Debit:...