mutiple choice accounting

Front

Which of the following is not a step in the accounting process? Identification., Economic entity., Recording., Communication.

Back

Economic entity.

Front

Which of the following statements about users of accounting information is incorrect? Management is an internal user., Taxing authorities are external users., Present creditors are external users., Regulatory authorities are internal users.

Back

Regulatory authorities are internal users.

Front

The historical cost principle states that:

Back

Assets should be recorded at their cost.

Front

Which of the following statements about basic assumptions is correct? Options: Basic assumptions are the same as accounting principles., The economic entity assumption states that there should be a particular unit of accountability., The monetary unit assumption enables accounting to measure employee morale., Partnerships are not economic entities.

Back

The economic entity assumption states that there should be a particular unit of accountability.

Front

The three types of business entities are: Proprietorships, partnerships, and corporations.

Back

Proprietorships, partnerships, and corporations.

Front

Net income will result during a time period when: Revenues exceed expenses.

Back

Revenues exceed expenses.

Front

As of December 31, 2017, Kent Company has assets of $3,500 and owner’s equity of $2,000. What are the liabilities for Kent Company?

Back

$1,500.

Front

Performing services on account will have the following effects on the components of the basic accounting equation: Increase assets and decrease owner’s equity., Increase assets and increase owner’s equity., Increase assets and increase liabilities., Increase liabilities and increase owner’s equity.

Back

Increase assets and increase owner’s equity.

Front

Which of the following events is not recorded in the accounting records? Equipment is purchased on account., A cash investment is made into the business., The owner withdraws cash for personal use.

Back

An employee is terminated.

Front

During 2017, Bruske Company’s assets decreased $50,000 and its liabilities decreased $50,000. Its owner’s equity therefore:

Back

Did not change.