Chapter 12 - Financial Management

Front

All income that a business receives over a period of time is called profit.

Back

False

Front

To prepare a budget, a business must be able to identify and predict the amount of each source of income and each type of expense.

Back

True

Front

To prepare a budget, a business must be able to identify and predict the amount of each source of income and each type of expense.

Back

False

Front

An accounts receivable record identifies the companies from which credit purchases were made and the status of each account.

Back

False

Front

Assets - Liabilities = Owner's Equity

Back

True

Front

Sales, expenses, and profits or losses for a specific period are reported in a company's income statement.

Back

True

Front

Payroll taxes consist of income taxes, Social Security, Medicare, and unemployment taxes. True or False?

Back

True

Front

At the end of the period covered by a budget, the business will prepare new financial statements.

Back

True

Front

Which of the following would NOT be considered an expense? wages paid to employees, taxes, purchases of supplies

Back

interest earned on investments

Front

The company's liabilities divided by the owner's equity is the current ratio.

Back

False