QUIZ 1 - Accounting Theory

The financial statement that reports the revenues and expenses for a period of time such as a year or a month is the:

• Balance Sheet

• Income Statement

• Statement of Cash Flows

• None of These

The financial statement that reports the assets, liabilities, and stockholders' (owner's) equity at a specific date is the:

• Balance Sheet

• Income Statement

• Statement of Cash Flows

• Cash Statement

Under the accrual basis of accounting, revenues are reported in the accounting period when the:

• Cash is Received

• Service or Goods Have Been Delivered

• End of the Month Has Arrived

• Customer Pays

Resources owned by a company (such as cash, accounts receivable, vehicles) are reported on the balance sheet and are referred to as __________.

• Assets

• Liabilities

• Owner Equity

• Equity

Assets are usually reported on the balance sheet at which amount?

• Cost

• Current Market Value

• Expected Selling Price

• None of These

Unearned Revenues is what type of account?

• Asset

• Liability

• Stockholders' Equity

• Expenses

Revenues minus expenses equals:

• Assets

• Liabilities

• Owner Equity

• Net Income

Entries to expenses such as Rent Expense are usually

• Debits

• Credits

Under the accrual basis of accounting, expenses are reported in the accounting period when the

• Cash is Paid

• Expense Matches the Revenues or is Used up

When a company pays a bill, the account Cash will be

• Debited

• Credited