All income that a business receives over a period of time is called profit.

• True

• False

To prepare a budget, a business must be able to identify and predict the amount of each source of income and each type of expense.

• True

• False

To prepare a budget, a business must be able to identify and predict the amount of each source of income and each type of expense.

• True

• False

An accounts receivable record identifies the companies from which credit purchases were made and the status of each account.

• True

• False

Assets - Liabilities = Owner's Equity

• True

• False

Sales, expenses, and profits or losses for a specific period are reported in a company's income statement.

• True

• False

Payroll taxes consist of income taxes, Social Security, Medicare, and unemployment taxes.

• True

• False

At the end of the period covered by a budget, the business will prepare new financial statements.

• True

• False

Which of the following would NOT be considered an expense?

• wages paid to employees

• interest earned on investments

• taxes

• purchases of supplies

The company's liabilities divided by the owner's equity is the current ratio.

• True

• False