Copy - BOWLING FOR PROFITS

Bowling for profits

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Chapters 3 & 4

Reporting of profitability

Reporting of expenses

Reporting of paid tax amount

1

What is the most important element of the income statement?

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2

Revenues over expenses

Excess of revenues over expenses or change in assets

All of the above

In a not-for-profit business, net income is typically or can be called:

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3

False

True

The requirement to provide financial accounting information driven by the need of outsiders to have reliable information regarding the financial status of an organization.

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4

SOS, I have no idea.

True

False

A complete set of financial statements include: Balance sheet, Income statement, Statement of changes in equity, Statement of cash flows, and notes.

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5

Accounting practices, composition of long-term debt, pension plan status and amount of charity care provided

Accounting practices & composition of long-term debt

Pension Plan Status and amount of charity care provided

The Notes section provides which of the following additional information?

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6

Assets

Liabilities & Equity

Assets & Expenses

An item that either possesses or creates economic value for an organization is:

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7

Assets

Expenses

Equity

The cost of doing business; the dollar value of resources used to provide goods or servcies is

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8

Equity

Assets

Liabilities

Assets minus liabilities; in other words, the "book value" of the ownership position of a business is:

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9

Revenues

Expenses

Assets

Inflows of assets resulting from the exchange of goods or services with customers is:

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10

Equity

Expenses

Liabilities

A fixed financial obligation or an organization is:

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Accrual accounting

Cash accounting

Modified cash accounting

11

Which accounting method recognizes an event when a cash obligation is created?

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12

Accrual accounting

Modified cash accounting

Cash accounting

Which accounting method recognizes an event when a cash transaction takes place?

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13

Inventory

Types of financing

Economic profitability

The income statement provides information about a business's operations and:

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14

Statement of operations

Both answers

Statement of activities

The income statement is often called:

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15

Results of operations over a period of time

A receipt of a transaction for an item purchased

A snapshot of the financial position of an organization at a given point in time

Which best describes a balance sheet?

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16

Assets = Liabilities + Equity

Assets = Profit - Liabilities

Assets = Net - Taxes

Which formula is best used when describing the characteristics of a balance sheet?

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Equity

Liabilities

Profits

17

Which term best describes the following: net assets, stockholders' equity, and proprietor's net worth?

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18

The statement of cash flows

The statement of operating activity

The capital structure

What is defined by the structure of the liabilities and equity side of the balance sheet of an organization?

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A snapshot of the financial position at a specific point in time

A historical record of financial transactions

A projection of future revenues

19

What does the balance sheet represent?

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20

Equity

Liabilities

Both liabilities and equity

According to the accounting identity, what must equal assets?

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