Question 1

Construct a balance sheet from the financial statements components listed below.

Accepted Answer

The answer of Construct a balance sheet from the financial...

Question 2

At January 30, 2016, the end of Dot, Inc.'s financial period in 2016, Dot's retained earnings were $88,440 million. During the following year, Dot reported net income of $28,666 million and paid a dividend of $2,690 million. Determine Dot's retained earnings as of January 29, 2017.

Accepted Answer

The answer of At January 30, 2016, the end of...

Question 3

Match each item with the financial statement in which each item would most likely appear:
-Revenue
A) Income Statement
B) Balance Sheet
C) Statement of Cash Flow

Accepted Answer

Revenue is typically reported on the Income Statement as it reflects the earnings generated from the normal business operations over a period of time.

Question 4

Match each item with the financial statement in which each item would most likely appear:
-Contributed capital
A) Income Statement
B) Balance Sheet
C) Statement of Cash Flow

Accepted Answer

Contributed capital is reported in the equity section of the Balance Sheet, reflecting the amount of capital a company has received from investors in exchange for stock.

Question 5

Match each item with the financial statement in which each item would most likely appear:
-Cash from investing activities
A) Income Statement
B) Balance Sheet
C) Statement of Cash Flow

Accepted Answer

Cash from investing activities is typically reported in the Statement of Cash Flows, which provides information about a company's cash receipts and cash payments during an accounting period.

Question 6

Match each item with the financial statement in which each item would most likely appear:
-Net change in cash
A) Income Statement
B) Balance Sheet
C) Statement of Cash Flow

Accepted Answer

Net change in cash is most accurately reflected in the Statement of Cash Flows, which provides a detailed account of how a company's cash position changes over a period due to operating, investing, and financing activities.

Question 7

Prepare a statement of cash flows for Doggie, Inc. for 2016 given its information below (amounts in millions):

Accepted Answer

The answer of Prepare a statement of cash flows for...

Question 8

At the beginning of 2016 Hotels International, Inc. had $11,820 million in assets and $1,562 million in equity. During 2016, Hotels International's assets increased by $864 million while its equity decreased by $1,008 million.
How much were Hotels International's liabilities at the beginning and end of 2016?

Accepted Answer

The answer of At the beginning of 2016 Hotels International,...

Question 9

In its 2016 annual report, Lego Pizza reported net income of $46,820 thousand, retained earnings at the beginning of 2016 of $91,670 thousand, and dividends of $33,908 thousand.
What is the amount of Domino's retained earnings at the end of 2016?

Accepted Answer

The answer of In its 2016 annual report, Lego Pizza...

Question 10

In addition to the financial statements, list 3 other sources of information reported to external stakeholders?

Accepted Answer

The answer of In addition to the financial statements, list...

Question 11

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once.
-Consistency
A) Although several accounting methods are acceptable, company management chooses a single method and follows that each year.
B) The company's accountant ignores a $1.60 error in recording an invoice, discovered after the final financial statements were prepared.
C) The accountant estimates the value of accounts receivable, based on recent information about economic forecasts and prior collection trends applicable to the company.
D) Before each board meeting, the company prepares a number of reports that are time-consuming and expensive that are never used.
E) In estimating the life of a new piece of equipment, the accounting department assumes that the business will last indefinitely. F. George Bush, a stockholder of Halliburton, owes a debt to Union Bank for $3,000. This $3,000 is not a debt of Halliburton.

Accepted Answer

Consistency in accounting refers to the use of the same accounting methods or principles from one period to another to ensure comparability of financial statements over time. Statement A directly addresses this by stating that the company management chooses a single accounting method and follows it each year, which is a clear example of consistency.

Question 12

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once.
-Relevance
A) Although several accounting methods are acceptable, company management chooses a single method and follows that each year.
B) The company's accountant ignores a $1.60 error in recording an invoice, discovered after the final financial statements were prepared.
C) The accountant estimates the value of accounts receivable, based on recent information about economic forecasts and prior collection trends applicable to the company.
D) Before each board meeting, the company prepares a number of reports that are time-consuming and expensive that are never used.
E) In estimating the life of a new piece of equipment, the accounting department assumes that the business will last indefinitely. F. George Bush, a stockholder of Halliburton, owes a debt to Union Bank for $3,000. This $3,000 is not a debt of Halliburton.

Accepted Answer

EC) This statement best exemplifies relevance because it involves using recent and applicable information to make informed estimates about accounts receivable, which is crucial for making the financial information useful for decision-making.E) This statement relates to the going concern assumption, which is an underlying assumption of accounting that assumes the business will continue to operate indefinitely, affecting how assets and liabilities are valued and reported.

Question 13

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once.
-Benefits > Costs
A) Although several accounting methods are acceptable, company management chooses a single method and follows that each year.
B) The company's accountant ignores a $1.60 error in recording an invoice, discovered after the final financial statements were prepared.
C) The accountant estimates the value of accounts receivable, based on recent information about economic forecasts and prior collection trends applicable to the company.
D) Before each board meeting, the company prepares a number of reports that are time-consuming and expensive that are never used.
E) In estimating the life of a new piece of equipment, the accounting department assumes that the business will last indefinitely. F. George Bush, a stockholder of Halliburton, owes a debt to Union Bank for $3,000. This $3,000 is not a debt of Halliburton.

Accepted Answer

The statement describes a situation where the costs of preparing reports outweigh the benefits, which aligns with the "Benefits > Costs" qualitative characteristic.

Question 14

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once.
-Going concern
A) Although several accounting methods are acceptable, company management chooses a single method and follows that each year.
B) The company's accountant ignores a $1.60 error in recording an invoice, discovered after the final financial statements were prepared.
C) The accountant estimates the value of accounts receivable, based on recent information about economic forecasts and prior collection trends applicable to the company.
D) Before each board meeting, the company prepares a number of reports that are time-consuming and expensive that are never used.
E) In estimating the life of a new piece of equipment, the accounting department assumes that the business will last indefinitely. F. George Bush, a stockholder of Halliburton, owes a debt to Union Bank for $3,000. This $3,000 is not a debt of Halliburton.

Accepted Answer

E is correct because the assumption that the business will last indefinitely directly relates to the going concern assumption, which assumes that the business will continue to operate for the foreseeable future, not liquidate or significantly curtail its operations.

Question 15

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once.
-Separate economic entity
A) Although several accounting methods are acceptable, company management chooses a single method and follows that each year.
B) The company's accountant ignores a $1.60 error in recording an invoice, discovered after the final financial statements were prepared.
C) The accountant estimates the value of accounts receivable, based on recent information about economic forecasts and prior collection trends applicable to the company.
D) Before each board meeting, the company prepares a number of reports that are time-consuming and expensive that are never used.
E) In estimating the life of a new piece of equipment, the accounting department assumes that the business will last indefinitely. 
F) George Bush, a stockholder of Halliburton, owes a debt to Union Bank for $3,000. This $3,000 is not a debt of Halliburton.

Accepted Answer

The separate economic entity assumption in accounting states that the business transactions are separate from the personal transactions of its owners or other businesses. Choice F illustrates this by indicating that a personal debt of a stockholder is not considered a debt of the company.

Question 16

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once.
-Materiality
A) Although several accounting methods are acceptable, company management chooses a single method and follows that each year.
B) The company's accountant ignores a $1.60 error in recording an invoice, discovered after the final financial statements were prepared.
C) The accountant estimates the value of accounts receivable, based on recent information about economic forecasts and prior collection trends applicable to the company.
D) Before each board meeting, the company prepares a number of reports that are time-consuming and expensive that are never used.
E) In estimating the life of a new piece of equipment, the accounting department assumes that the business will last indefinitely. F. George Bush, a stockholder of Halliburton, owes a debt to Union Bank for $3,000. This $3,000 is not a debt of Halliburton.

Accepted Answer

Materiality refers to the significance of transactions, balances, and errors contained in the financial statements. An error is considered material if it could influence the economic decisions of users taken on the basis of the financial statements. The decision to ignore a $1.60 error in recording an invoice because it is immaterial to the financial statements is an application of the materiality concept.

Question 17

Anka Audio reported the following amounts in its December 31, 2016, and 2015 financial statements.
  Calculate to the nearest hundredth:
A. Return on equity for 2016.
B. Debt-to-equity ratio as of December 31, 2016

Accepted Answer

The answer of Anka Audio reported the following amounts in...

Question 18

Lorraine, Inc. has a debt-to-equity ratio of 0.49 and a ROE of 16.8%. The median ROE for similar companies in the same industry as Lorraine is about 15.1%. The median debt-to-equity ratio for similar companies in the same industry is 0.36. Based on this industry information, how does Lorraine compare to similar companies and what are the causes of these differences?

Accepted Answer

The answer of Lorraine, Inc. has a debt-to-equity ratio of...

Question 19

The following is selected financial information of Gleeson Group, Inc. for the year ended December 31, 2016.
  Prepare an income statement, balance sheet and statement of cash flows for Gleeson Group, Inc. at December 31, 2016.

Accepted Answer

The answer of The following is selected financial information of...

Question 20

The following is selected financial information for Maurermart, Inc. for its year ending January 31, 2016:
  Prepare a statement of stockholders' equity for 2016 for Mauermart.

Accepted Answer

The answer of The following is selected financial information for...

Quiz 1: Introducing Financial Accounting

Construct a balance sheet from the financial statements components listed below.

At January 30, 2016, the end of Dot, Inc.'s financial period in 2016, Dot's retained earnings were $88,440 million. During the following year, Dot reported net income of $28,666 million and paid a dividend of $2,690 million. Determine Dot's retained earnings as of January 29, 2017.

Match each item with the financial statement in which each item would most likely appear: -Revenue

Match each item with the financial statement in which each item would most likely appear: -Contributed capital

Match each item with the financial statement in which each item would most likely appear: -Cash from investing activities

Match each item with the financial statement in which each item would most likely appear: -Net change in cash

Prepare a statement of cash flows for Doggie, Inc. for 2016 given its information below (amounts in millions):

In its 2016 annual report, Lego Pizza reported net income of $46,820 thousand, retained earnings at the beginning of 2016 of $91,670 thousand, and dividends of $33,908 thousand. What is the amount of Domino's retained earnings at the end of 2016?

In addition to the financial statements, list 3 other sources of information reported to external stakeholders?

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once. -Consistency

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once. -Relevance

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once. -Benefits > Costs

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once. -Going concern

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once. -Separate economic entity

Match each of the following statements to the best qualitative characteristic or underlying assumption of accounting information that should be considered. Each answer is used only once. -Materiality

Anka Audio reported the following amounts in its December 31, 2016, and 2015 financial statements. Calculate to the nearest hundredth: A. Return on equity for 2016. B. Debt-to-equity ratio as of December 31, 2016

The following is selected financial information of Gleeson Group, Inc. for the year ended December 31, 2016. Prepare an income statement, balance sheet and statement of cash flows for Gleeson Group, Inc. at December 31, 2016.

The following is selected financial information for Maurermart, Inc. for its year ending January 31, 2016: Prepare a statement of stockholders' equity for 2016 for Mauermart.