Accounting 1 - Ch. 7 Review

The date on a monthly income statement prepared on November 30 is written as

• For Month Ended November 30, 20--
• November 30, 20--
• 20--, November 30
• none of the other options

The amount of net income calculated on an income statement is correct if

• it is the same as net income shown on the work sheet.
• debits equal credits.
• it is the same as the balance sheet.

Preparing financial statements at the end of each fiscal period is what accounting concept?

• Adequate Disclosure
• Going Concern
• Objective Evidence
• Accounting Period Cycle

The dollar amounts needed to prepare an income statement's revenue section is obtained from the

• Income Statement Debit column.
• the Income Statement Credit column.
• Balance Sheet Debit column.
• Balance Sheet credit column.

A balance sheet reports a business's financial

• condition over a specific period of time.
• progress over a specific period of time.
• condition on a specific date.
• progress on a specific date.

When preparing a balance sheet, the amount of owner's capital is obtained from

• the general ledger.
• the income statement.
• the work sheet's Balance Sheet Credit column.
• none of the other choices.

The formula for calculating the net income component percentage is

• net income divided by total sales.
• total sales divided by total expenses.
• total sales minus total expenses.

Information needed to prepare a balance sheet liabilities section is obtained from the 

• Income Statement Debit column.
• Income Statement Credit column.
• Balance Sheet Debit column.
• Balance Sheet Credit column.

Financial statements containing all necessary information to understand financial condition is

• Adequate Disclosure
• Going Concern
• Objective Evidence
• Accounting Period Cycle

On an income statement, double lines across both amount columns indicate that debits=credits.

• True
• False