Question

1) Net income:

A) is calculated by subtracting total expenses and total dividends from total revenues.

B) occurs when total revenues are less than total expenses.

C) is often referred to as the "bottom line" on an income statement.

D) decreases total stockholders' equity.

2) On January 1, 2017, total assets for Wininger Technologies were $140,000; on December 31, 2017, total assets were $155,000. On January 1, 2017, total liabilities were $111,000; on December 31, 2017, total liabilities were $118,000. What is the amount of the change and the direction of the change in Wininger Technologies' owners' equity for 2017?

A) decrease of $8000

B) increase of $8000

C) increase of $22,000

D) decrease of $22,000

3) Golden Company had the following accounts and balances at the end of the year. What are total assets at the end of the year?

Cash	$75,000
Accounts Payable	$14,000
Common Stock	$21,000
Cost of Goods Sold	$95,000
Dividends Declared and Paid	$12,000
Operating Expenses	$12,000
Accounts Receivable	$55,000
Inventory	$42,000
Long-term Notes Payable	$33,000
Revenues	$130,000
Salaries Payable	$28,000

A) $75,000

B) $117,000

C) $130,000

D) $172,000

4) The CORRECT data flow from one financial statement to the next is:

A) statement of retained earnings, income statement, balance sheet, statement of cash flows.

B) balance sheet, statement of retained earnings, income statement, statement of cash flows.

C) statement of retained earnings, income statement, statement of cash flows, balance sheet.

D) income statement, statement of retained earnings, balance sheet, statement of cash flows.

5) Potter Company reports the following line items:

Long-Term Notes Payable	$50,000
Accounts Receivable	$28,000
Accounts Payable	$37,000
Building	$55,000
Cash and Cash Equivalents	$80,000
Salaries Expense	$25,500
Service Van	$26,000
Interest Payable	$1,500
Land	$40,000
Short-term Investments	$5,000
Income Taxes Payable	$10,000
Equipment	$59,500
Supplies	$5,000
Service Revenue	$104,000
Supplies Expense	$20,000
Utilities Expense	$11,500
Income Tax Expense	$13,000

What is net income?

A) $26,000

B) $34,000

C) $59,500

D) $104,000

6) Analyze each of the following transactions in terms of their effects on the accounting equation of Osgood Delivery Service. The company is a sole proprietorship. Enter the correct amounts in the columns of the spreadsheet.

a)   James Osgood contributes $75,000 cash to the business in exchange for capital.

b) The business purchases $750 of office supplies on account.

c)   The business pays cash to purchase a delivery van for $25,000.

d) Services are performed for clients and $5,000 cash is received.

e)   Cash is paid for rent expense, $800 and utilities expense, $400.

f)   James Osgood withdraws $1,000 from the business for personal use.

	Cash	Accts. Receiv- able	Office Supplies	Delivery Van	Accts. Payable	Osgood, Capital	Osgood, With- drawals	Service Revenue	Rent Expense	Utilities Expense
a
b
c
d
e
f

Answer 1