11.The retained earnings section of the statement of shareholders’ equity communicates
a. beginning balance plus income less dividends.
b. revenues less expenses during a period of time.
c. how much cash that management has paid for bonuses.
d. operating, investing, and financing activities.
12.An investor wants to find the amount of cash and land that a company has. Where will the investor look?
a. Statement of shareholders’ equity
b. Income statement
c. Balance sheet
d. Statement of cash flows
13.Dividends declared and paid to the owners are found in the
a. management letter.
b. income statement.
c. dividends statement.
d. statement of shareholders’ equity.
14.Cash received by a company from its regular operations during the year is found in its
a. balance sheet.
b. statement of cash flows.
c. statement of shareholders’ equity.
d. auditor’s report.
15.A company’s profits during its most recent year are found in its
a. balance sheet and income statement.
b. statement of cash flows only.
c. statement of shareholders’ equity only.
d. income statement and statement of shareholders’ equity.
16.The cash paid during the year to satisfy a company’s debt is found in its
a. statement of cash flows.
b. income statement.
c. statement of shareholders’ equity.
d. auditor’s report.
17.The amount which a company’s customers owe the company for products delivered or services rendered is found in the
a. footnotes only.
b. income statement.
c. balance sheet.
d. statement of cash flows.
18.Solvency may be described as
a. an amount owed that must be paid in the future.
b. amounts that can be distributed to owners only.
c. the amount invested in the firm by its owners.
d. the ability to generate enough cash to pay its debt as the amounts become due.
19.Retained earnings may be described as
a. the total past profits retained in the business.
b. a company’s future growth.
c. the amount invested in the firm by its owners.
d. amounts retained for payments to vendors.
20.Liabilities may be described as
a. amounts that will be used for future growth.
b. the amounts owed that must be paid in the future.
c.the total measured past growth of a firm less the amount distributed to the owners.
d.amounts the company paid during the past year.