Accounting

1. Owner's equity is best depicted by the following?

a) Assets/Liabilities.
b) Liabilities + Assets.
c) Residual equity + Assets.
d) Assets – Liabilities.

2. If total liabilities increased by $6,000, then:

a) assets must have decreased by $6,000.
b) owner's equity must have increased by $6,000.
c) assets must have increased by $6,000, or owner's equity must have
decreased by $6,000.
d) assets and owner's equity each increased by $3,000.

3. Net income results when:

a) Assets > Liabilities.
b) Revenues = Expenses.
c) Revenues > Expenses.
d) Revenues < Expenses.

4. Juggernaut Company buys a $29,000 van on credit. The transaction

will affect the:
a) income statement only.
b) balance sheet only.
c) income statement and owner's equity statement only.
d) income statement, owner's equity statement, and balance sheet.

5. The fiscal year of a business is usually determined by:

a) the IRS.
b) a lottery.
c) the business.
d) the SEC.

6. If an individual asset is increased, then:

a) there must be an equal decrease in a specific liability.
b) there must be an equal decrease in owner's equity.
c) there must be an equal decrease in another asset.
d) All of these answer choices are possible.

7. As of December 31, 2016, Cancon Company has assets of $42,000

and owner's equity of $22,000. What are the liabilities for Cancon
Company as of December 31, 2016?
a) $22,000.
 b) $20,000.
c) $42,000.
d) $64,000.

8. Which of the following events is not a business transaction?

a) Investment of cash by the owner.
b) Hired employees.
c) Incurred utility expenses for the month.
d) Earned revenue for services provided.

9. The usual sequence of steps in the transaction recording process is:

a) journal -> analyze -> ledger.
b) analyze -> journal -> ledger.
c) journal -> ledger -> analyze.
d) ledger -> journal -> analyze.

10. An accounting time period that is one year in length, but does not begin
on January 1, is referred to as:
a) a fiscal year.
b) an interim period.
c) the time period assumption.
d) a reporting period.