Question

o ne of the three forms of business organization? Which of the following a Corporations b. Partnerships C. Proprietorships d. Investors An advantage of the corporate form of business is that a it has limited life b. its owner's personal resources are at stake. its ownership is easily transferable via the sale of shares of stock. d it is simple to establish 3. Bened Benedict Company compiled the following financial information as of December 31, 2022: Service revenue S1.120,000 Common stock 240.000 Equipment 320,000 Salaries and wages expense 400.000 Rent expense 100,000 Depreciation expense 500.000 Cash 280,000 Dividends 80,000 Supplies 40.000 Accounts payable 160.000 Accounts receivable 120.000 Retained earnings, 1/1/2022 600,000 Benedict's total stockholders' equity at December 31, 2022 is a. $840,000 b. $880,000 C. $640.000 d. $960.000 4. Claims of owners are called a. dividends. b. stockholders' equity. c. liabilities. d. income payable 5. During September 2022, Blowing Rock Diner's total liabilities decreased by $75,000 and its stockholders' equity increased by $15,000. The company's total assets must change by what amount and in what direction during that same period? a. $60,000 decrease b. $60,000 increase c. $75,000 increase d. $90,000 increase 6. In a classified balance sheet, assets are usually classified as a current assets; long-term assets: property, plant, and equipment, and intangible assets. b. current assets; long-term investments, property, plant, and equipment, and common stocks. c. current assets; long-term investments, tangible assets, and intangible assets. d. current assets; long-term investments, property, plant, and equipment, and intangible assets. 7. A current asset is a. the last asset purchased by a business. b. an asset which is currently being used to produce a product or service. c. usually found as a separate classification in the income statement. d. expected to be converted to cash or used in the business within one year or one operating cycle, whichever is longer. 3. Which of the following is not a satisfactory statement of the accounting equation? 1 Page

Answer 1

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1	Investors
2	Option C.
		Amount $
3	Common Stock	240,000.00
	Retained Earnings	600,000.00
	Service Revenue	1,120,000.00
	Salaries and wages expense	(400,000.00)
	Rent expense	(100,000.00)
	Depreciation expense	(500,000.00)
	Dividends	(80,000.00)
	Total stockholder's equity	$    880,000.00
	Option B.
4	Stockholder's equity
5	Option A.
6	Option D.
7	Option D.