Acct 4.00 Test Review

The purpose of having accounting standards is to:

• create uniformity between financial statements.

• create jobs for people.

• produce documents that look professional.

Cash is an example of assets.

• True

• False

Which represents the inflow of funds into a business?

• cash

• debt

• expenses

The finance activity regarding how to source income is called .

• accounting
• liability

• acquiring funds

The accounting document that shows a business's revenue and expenses is a/an ________.

• Balance Sheet

• Income Statement

• Cash Flow Statement

________: debts that the business owes.

• A. income statement

• B. liabilities

• C. net worth

________: a financial summary that shows how much money the business has made or has lost; also called the profit-and-loss statement.

• income statement

• liabilities

• net worth

________: the total value of the business.

• external users

• internal users

• net worth

people within the business who use financial information – owners, managers, and employees.

• external users

• internal users

• net worth

people outside the business who use accounting information – suppliers, banks, customers, lenders, investors, and tax authorities.

• external users

• internal users

• net worth