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Exam 1: An Introduction to Accounting

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Question 51

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Stosch Company's balance sheet reported assets of $40,000,liabilities of $15,000 and common stock of $12,000 as of December 31,Year 1.Retained earnings on the December 31,Year 2 balance sheet is $18,000 and Stosch paid a $14,000 dividend during Year 2.What is the amount of net income for Year 2?

A) $17,000
B) $19,000
C) $13,000
D) $21,000

E) C) and D)
F) A) and B)

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Question 52

Multiple Choice

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Expenses are reported on which of the following financial statement(s) ?

A) Income statement
B) Balance sheet
C) Statement of changes in stockholders' equity
D) Income statement and statement of changes in stockholders' equity

E) C) and D)
F) None of the above

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Question 53

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A business and the person who owns the business are separate reporting entities.

Retained earnings at the beginning and ending of the accounting period were $300 and $800,respectively.Revenues of $1,100 and dividends paid to stockholders of $200 were reported during the period.What was the amount of expenses reported for the period?

As of December 31,Year 1,Mason Company had $500 cash.During Year 2,Mason earned $1,200 of cash revenue and paid $800 of cash expenses.What is the amount of cash that will be reported on the balance sheet at the end of Year 2?

[The following information applies to the questions displayed below.] Lexington Company engaged in the following transactions during Year 1, its first year in operation: (Assume all transactions are cash transactions) Acquired $6,000 cash from issuing common stock. Borrowed $4,400 from a bank. Earned $6,200 of revenues. Incurred $4,800 in expenses. Paid dividends of $800. Lexington Company engaged in the following transactions during Year 2: (Assume all transactions are cash transactions) Acquired an additional $1,000 cash from the issue of common stock. Repaid $2,600 of its debt to the bank. Earned revenues, $9,000. Incurred expenses of $5,500. Paid dividends of $1,280. -What is the amount of total assets that will be reported on Lexington's balance sheet at the end of Year 1?

[The following information applies to the questions displayed below.] Lexington Company engaged in the following transactions during Year 1, its first year in operation: (Assume all transactions are cash transactions) Acquired $6,000 cash from issuing common stock. Borrowed $4,400 from a bank. Earned $6,200 of revenues. Incurred $4,800 in expenses. Paid dividends of $800. Lexington Company engaged in the following transactions during Year 2: (Assume all transactions are cash transactions) Acquired an additional $1,000 cash from the issue of common stock. Repaid $2,600 of its debt to the bank. Earned revenues, $9,000. Incurred expenses of $5,500. Paid dividends of $1,280. -What was the amount of liabilities on Lexington's balance sheet at the end of Year 2?

In a market,a company that manufactures cars would be referred to as a conversion agent.

International accounting standards are formulated by the IASB.What does that acronym stand for?

Garrison Company acquired $23,000 by issuing common stock.Which of the following accurately reflects how this event affects the company's financial statements?

Which of the following cash transactions would not affect total assets?

[The following information applies to the questions displayed below.] Lexington Company engaged in the following transactions during Year 1, its first year in operation: (Assume all transactions are cash transactions) Acquired $6,000 cash from issuing common stock. Borrowed $4,400 from a bank. Earned $6,200 of revenues. Incurred $4,800 in expenses. Paid dividends of $800. Lexington Company engaged in the following transactions during Year 2: (Assume all transactions are cash transactions) Acquired an additional $1,000 cash from the issue of common stock. Repaid $2,600 of its debt to the bank. Earned revenues, $9,000. Incurred expenses of $5,500. Paid dividends of $1,280. -What was the net cash flow from financing activities reported on Lexington's statement of cash flows for Year 2?

Jackson Company had a net increase in cash from operating activities of $10,000 and a net decrease in cash from financing activities of $2,000.If the beginning and ending cash balances for the company were $4,000 and $11,000,what was the net cash change from investing activities?

The following information applies to the questions displayed below Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.) 1) Acquired $950 cash from the issue of common stock. 2) Borrowed $420 from a bank. 3) Earned $650 of revenues. 4) Paid expenses of $250. 5) Paid a $50 dividend. During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.) 1) Issued an additional $325 of common stock. 2) Repaid $220 of its debt to the bank. 3) Earned revenues of $750. 4) Incurred expenses of $360. 5) Paid dividends of $100. -What is the after-closing amount of retained earnings that will be reported on Packard's balance sheet at the end of Year 2? (Assume that closing entries have been passed) .