Chapter 1

Role of Accounting/Ethics

100

Financial accounting provides _____ users with information

External

200

Managerial Accounting provides _____ users with information

Internal

300

Name 2 external users for financial statements

investors

Creditors/banks

Government

400

True/False: Bankruptcy is the only consequence of unethical handling of financial statements. 

False: Executives plead guilty, large fines

500

Certification required to work in public accounting

CPA: Certified Public Accountant

Assets & Liabilities

100

Name an asset account

Cash

Account Receivable

Land

Supplies

ETC. 

200

Name a Liability account

Account Payable

300

Purchased supplies on account  (Element & Account & Increase/Decrease)

Asset - Supplies -  increase

Liability - Account payable - increase

400

Company A paid $500 to company B for an invoice. You are Company A. (Element - Account - Increase/Decrease)

Asset - Cash - Decrease

Liability - Account Payable - Decrease

500

We collected $450 for past revenue that was on account (Element - Account - Incease/Decrease)

Asset - Cash - increase

Asset - Account Receivable - decrease

Types of Business/Concepts

100

Financial statement should be measured in what unit? (unit of measure concept)

Dollar - also accepted Currency

200

First Health is what type of business?

Service

300

A warehouse was listed at 140,000. The first company offer was 120,000. A second company offered 125,000 and a third company swooped in at the last minute for $129,000. The third buyer overpaid since it was appraised at 112,000. For what price would the third buyer record the purchase of the warehouse?

129,000

400

True/False: Sept 1 to July 31 is an acceptable fiscal year

FALSE

500

Burt's Bees is what type of business?

Manufacturing

Equity

100

Equity = ? 

=Assets - Liabilities

200

What two items increase equity? 

Owner's Investment & Revenue

300

What two items decrease owner's equity?

Owner's withdrawal and expenses

400

Net income (Loss) = ?

Revenues - Expenses

500

What is the owner's investment account called? 

Owner's Capital

Accounting Standards & Accounting Equation

100

Assets = ?

Liabilities + Equity

200

Assets are 600 and liabilities are 502. What is Equity?

98

300

Year 1: Assets: 873; Liabilities: 298

If Assets increase by 50 and liabilities decrease by 18 in Year 2, what is equity? 

643

400

What does GAAP stand for?

Generally Accepted Accounting Principles, created by Financial Account Standards Board (FASB)

500

What does IFRS stand for?

International Financial Reporting Standards created by International Accounting Standards Board (IASB)