Fall 2020 Accounting 1 Mid-Term

Front

To survive, a business must______

Back

Earn a profit and have someone willing to take the risk to run it.

Front

A business is earning a profit if the selling price of its product covers the cost of the raw materials needed to make the product

Back

False

Front

Accounting is often called the "language of business" because_____

Back

It is fundamental to the communication of financial information

Front

Only businesses that earn a profit will have the economic resources to continue to operate.

Back

True

Front

Which of the following would not be considered a service business: General Motors, North American Van Lines, Delta Air Lines, Alamo Rent a Car?

Back

General Motors

Front

In a business, it is the entrepreneur who_____

Back

Is willing to take the risks to establish and organize the venture

Front

The most common time period covered by an accounting report is one _____

Back

Year

Front

Corporations often start out as sole proprietorships or partnerships

Back

True

Front

Do all businesses set up their accounting systems in the same manner?

Back

No, businesses can set up their accounting systems differently.

Front

Service businesses are not intended to operate as a profit

Back

False