1) A written agreement setting forth the conditions under which a partnership is to operate a) Articles of Incorporation b) Charter c) Code of conduct/ethics d) Partnership agreement e) Capital Stock 2) A statement that guides the ethical behavior of a company and its employees a) Articles of Incorporation b) Charter c) Code of conduct/ethics d) Partnership agreement e) Capital Stock 3) Double taxation, more government regulations and less control are disadvantages of a: a) Service Business b) Merchandising Business c) Manufacturing Business d) Sole Proprietorship e) Partnership f) Corporation 4) Ease of formation, More capital available, share work are advantages of a: a) Service Business b) Merchandising Business c) Manufacturing Business d) Sole Proprietorship e) Partnership f) Corporation 5) A business that makes and sells the products; a business organized to convert raw materials into finished goods a) Service Business b) Merchandising Business c) Manufacturing Business d) Sole Proprietorship e) Partnership f) Corporation 6) Kohl's is an example of a(n) a) Service Business b) Merchandising Business c) Manufacturing Business d) Business Entity Concept e) Partnership 7) Agency responsible for protecting investors, maintaining fair and orderly functioning of the securities markets a) International Accounting Standards Board b) Financial Accounting Standards Board c) Securities and Exchange Commission d) Generally Accepted Accounting Principles e) Statement of Financial Accounting Concepts 8) The owner of a dry cleaning business maintains separate checkbooks for his business and his personal affairs a) Monetary unit concept b) Business Entity c) Objective Evidence d) Going Concern 9) Company journalized the transaction for payment received from customer using Receipt Number 7 a) Monetary unit concept b) Business Entity c) Objective Evidence d) Going Concern 10) Inventory is found in which financial statement: a) Balance Sheet b) Income Statement c) Statement of Stock Holder's Equity d) Auditor's Report 11) Statement indicating whether the company followed GAAP when preparing its financial statements a) Balance Sheet b) Income Statement c) Statement of Stock Holder's Equity d) Auditor's Report 12) A company received $145,000 from customers and provided $175,000 of services during the year. The company's employees earned $74,000 in wages, but due to they way payroll is determined (monthly) the employees were only paid $60,000. What is accrual basis income? a) $71,000 b) $85,000 c) $101,000 d) $115,000 e) $186,000 13) A company received $145,000 from customers and provided $175,000 of services during the year. The company's employees earned $74,000 in wages, but due to they way payroll is determined (monthly) the employees were only paid $60,000. What is cash basis income? a) $71,000 b) $85,000 c) $101,000 d) $115,000 e) $186,000 14) Cash - $339 Accts Rec - $766 Inventory - $56 Accts Pay - $115 other current liabilities - $304 Sales - $828 Payroll Expense - $620 Advertising Expense - $36 Utilities Expense - $94 What is the company's net income? a) -$742 b) $742 c) $114,887 d) $1,105 e) $1,578 f) $78 15) Cash - $339 Accts Rec - $766 Inventory - $56 Accts Pay - $115 other current liabilities - $304 Sales - $828 Payroll Expense - $620 Advertising Expense - $36 Utilities Expense - $94 What is the return on sales ratio? a) -.07 b) .56 c) .36 d) .09 e) -.09 f) .0742 16) Cash - $339 Accts Rec - $766 Inventory - $56 Accts Pay - $115 other current liabilities - $304 Sales - $828 Payroll Expense - $620 Advertising Expense - $36 Utilities Expense - $94 What is the current ratio? a) -.07 b) .56 c) .36 d) .09 e) -.09 f) .0742 17) The following is a characteristic of a sole proprietorship, Partnership or Corporation: Legal Entity a) Sole Proprietorship b) Partnership c) Corporation 18) The following is a characteristic of a sole proprietorship, Partnership or Corporation: More Capital Available a) Sole Proprietorship b) Partnership c) Corporation 19) The following is a characteristic of a sole proprietorship, Partnership or Corporation: Retention of all profits a) Sole Proprietorship b) Partnership c) Corporation 20) The following is a characteristic of a sole proprietorship, Partnership or Corporation: Terminates with life of owner a) Sole Proprietorship b) Partnership c) Corporation

Quiz: Accounting Review

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