d ANSWER: Assets Liabilities + Equity RATIONALE: = Stockholders’ = Liabilities + $71,000 –$88,000 Liabilities = –$159,000 Moderate DIFFICULTY: Bloom's: Remembering FNMN.WARD.16.01-04 - LO: 01-04 LEARNING OBJECTIVES: ACCT.ACBSP.APC.06 - Recording Transactions ACCREDITING STANDARDS: ACCT.AICPA.FN.03 Measurement – BUSPROG: Analytic Cash dividends increase expenses decrease expenses increase cash decrease stockholders' equity d ANSWER: Easy DIFFICULTY: Bloom's: Remembering FNMN.WARD.16.01-04 - LO: 01-04 LEARNING OBJECTIVES: ACCT.ACBSP.APC.06 - Recording Transactions ACCREDITING STANDARDS: ACCT.AICPA.FN.03 Measurement – BUSPROG: Analytic How does paying a liability in cash affect the accounting equation? assets increase; liabilities decrease assets increase; liabilities increase assets decrease; liabilities decrease liabilities decrease; stockholders' equity increases c ANSWER: Moderate DIFFICULTY: Bloom's: Remembering FNMN.WARD.16.01-04 - LO: 01-04 LEARNING OBJECTIVES: ACCT.ACBSP.APC.06 - Recording Transactions ACCREDITING STANDARDS: ACCT.AICPA.FN.03 Measurement – BUSPROG: Analytic How does receiving a bill to be paid next month for services received affect the accounting equation? assets decrease; stockholders' equity decreases assets increase; liabilities increase liabilities increase; stockholders' equity increases liabilities increase; stockholders' equity decreases d ANSWER: Moderate DIFFICULTY: Bloom's: Remembering FNMN.WARD.16.01-04 - LO: 01-04 LEARNING OBJECTIVES: ACCT.ACBSP.APC.06 - Recording Transactions ACCREDITING STANDARDS: ACCT.AICPA.FN.03 Measurement – BUSPROG: Analytic
ANSWER: d RATIONALE: Assets = Liabilities + Stockholders’ Equity –$88,000 = Liabilities + $71,000 Liabilities = –$159,000 DIFFICULTY: Moderate Bloom's: Remembering LEARNING OBJECTIVES: FNMN.WARD.16.01-04 - LO: 01-04 ACCREDITING STANDARDS: ACCT.ACBSP.APC.06 - Recording Transactions ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic Cash dividends increase expenses decrease expenses increase cash decrease stockholders' equity ANSWER: d DIFFICULTY: Easy Bloom's: Remembering LEARNING OBJECTIVES: FNMN.WARD.16.01-04 - LO: 01-04 ACCREDITING STANDARDS: ACCT.ACBSP.APC.06 - Recording Transactions ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic How does paying a liability in cash affect the accounting equation? assets increase; liabilities decrease assets increase; liabilities increase assets decrease; liabilities decrease liabilities decrease; stockholders' equity increases ANSWER: c DIFFICULTY: Moderate Bloom's: Remembering LEARNING OBJECTIVES: FNMN.WARD.16.01-04 - LO: 01-04 ACCREDITING STANDARDS: ACCT.ACBSP.APC.06 - Recording Transactions ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic How does receiving a bill to be paid next month for services received affect the accounting equation? assets decrease; stockholders' equity decreases assets increase; liabilities increase liabilities increase; stockholders' equity increases liabilities increase; stockholders' equity decreases ANSWER: d DIFFICULTY: Moderate Bloom's: Remembering LEARNING OBJECTIVES: FNMN.WARD.16.01-04 - LO: 01-04 ACCREDITING STANDARDS: ACCT.ACBSP.APC.06 - Recording Transactions ACCT.AICPA.FN.03 – Measurement BUSPROG: Analytic
FinMan_Chapter_01_Introduction_to_Accounting_and_Business.docx