Accounting II Practice Questions #1

Which of the following is not a financial statement?

• Income Statement

• Statement of Cash Flow

• Balance Sheet

• Statement of Owners Equity

The purpose of the statement of cash flows is to?

• Net Income

• Inventory Valuation

• Prove change in cash

• Change in Owners Equity

If our owners equity beginning balance is $10,000, the net income is $5,000 and we have additional investments of $2,500; what is our ending owners equity balance?

• $17,500

• $15,000

• $12,500

• $10,000

Which is not a heading on a classified balance sheet?

• Property Plant and Equipment

• Long Term Liabilities

• Current Assets

• Accounts Receivable

If buying a new piece of equipment costs $10,000 and the new piece of equipment will generate an extra $1000 per year in revenue; what is the payback period?

• 10 Years

• 5 Years

• 1 Years

• 20 Years

If Assets in 2014 were $19,200 and Assets in 2013 were 16,000; what percent did assets increase in 2014?

• 10%

• 15%

• 25%

• 20%

If Net income dropped 20% from 2013 to 2014 and net income was $10,000 in 2014, what was net income in 2013?

• $12,500

• $10,000

• $2,500

• $0

If net income increases by $10,000, the net effect on the financial statements would be:

• A decrease to owners equity

• An increase to owners equity

• A decrease in current assets

• A decrease in cash flow

Net income from the Income Statement flows into the preparation of which financial statement?

• Statement of Owners Equity

• Bank Reconciliation

• Statement of Account

• Balance Sheet

A corporation is owned by

• The individual who started the company

• Its board of directors

• The president of the corporation

• Its Stockholders