Financial Accounting Ch 1 Test 2

What are financial statements?

• The accounting reports providing summarised transactions

• The accounting reports providing recorded and summarised transactions

Which of the following is the correct order of preparation of financial statements?

• Statement of cash flows, statement of owner's equity, income statement, balance sheet

• Income statement, Balance sheet, Statement of cash flows, Statement of owner's equity

• Income statement, Statement of owner's equity, Balance sheet, Statement of cash flows

• Statement of owner's equity, Income statement, Balance sheet, statement of cash flows

Which of the following is correct about the Income Statement?

• A summary of the cash receipts and cash payments for a specific period of time, such as a month or a year.

• A summary of the revenue and expenses for a specific period of time, such as a month or a year.

• A summary of the changes in the owner's equity that have occurred during a specific period of time, such as a month or a year.

• A list of the assets, liabilities, and owner's equity as a specific date, usually at the close of the last day of a month or a year.

Which of the following is correct about the Statement of owner's equity?

• A summary of the cash receipts and cash payments for a specific period of time, such as a month or a year.

• A summary of the revenue and expenses for a specific period of time, such as a month or a year.

• A summary of the changes in the owner's equity that have occurred during a specific period of time, such as a month or a year.

• A list of the assets, liabilities, and owner's equity as a specific date, usually at the close of the last day of a month or a year.

Which of the following is correct about the Balance Sheet?

• A summary of the cash receipts and cash payments for a specific period of time, such as a month or a year.

• A summary of the revenue and expenses for a specific period of time, such as a month or a year.

• A summary of the changes in the owner's equity that have occurred during a specific period of time, such as a month or a year.

• A list of the assets, liabilities, and owner's equity as a specific date, usually at the close of the last day of a month or a year.

Which of the following is correct about the Statement of Cash Flows?

• A summary of the cash receipts and cash payments for a specific period of time, such as a month or a year.

• A summary of the revenue and expenses for a specific period of time, such as a month or a year.

• A summary of the changes in the owner's equity that have occurred during a specific period of time, such as a month or a year.

• A list of the assets, liabilities, and owner's equity as a specific date, usually at the close of the last day of a month or a year.

Which of the following statements are reports for a specific period of time?

• Balance sheet, Statement of owner's equity, Statement of cash flows

• Income statement, Statement of owner's equity, Balance sheet

• Income statement, Statement of owner's equity, Statement of cash flows

Which of the following statements are reports for a specific date?

• Balance sheet, Statement of owner's equity, Statement of cash flows

• Balance sheet

• Balance sheet, Statement of cash flows

What does the Income statement report?

• Assets, Liabilities, Owner's equity

• Revenues and expenses

• Assets and expenses

• Liabilities and Revenues

What does the matching concept practically mean?

• The expenses incurred on a specific date are matching with the revenue that those expenses generated.

• The expenses incurred during a period are matching with the revenue that those expenses generated.