ACCT 2110 CH1

What is accounting often referred to as?

• The language of business

• The science of numbers

• The art of finance

• The system of economics

What do multiple decision-makers use to make better decisions?

• Financial information provided by accountants

• Market trends

• Customer feedback

• Competitor analysis

What is revenue?

• The increase in assets from the sale of products or services

• The decrease in liabilities from the sale of products or services

• The total amount of expenses incurred

• The net income of a corporation

What happens when expenses are greater than revenues?

• A corporation incurs a net loss

• A corporation earns a net income

• A corporation breaks even

• A corporation increases its assets

What are purchases (and sales) of operational assets referred to as?

• Investing activities

• Financing activities

• Operating activities

• Marketing activities

What are the funds obtained through issuing stock or borrowing money used for?

• Financing activities

• Marketing activities

• Operating activities

• Investing activities

What are obligations to repay creditors called?

• Liabilities

• Assets

• Revenues

• Expenses

What are claims of the stockholders called?

• Stockholders' equity

• Liabilities

• Assets

• Revenues

What is the Balance Sheet composed of?

• Assets, liabilities, and stockholders' equity

• Revenues, expenses, and net income

• Income retained in the business

• Cash flows from operating activities

What does the Income Statement report?

• Revenues, expenses, and income

• Assets, liabilities, and stockholders' equity

• Cash flows from operating activities

• Income retained in the business