151. At October 1, Smithson Enterprises reported stockholders' equity of $70,000. During October, common stock of $10,000 was issued and the company posted a net loss of $6,000. If stockholders' equity at October 31 totals $70,000, what amount of dividends were paid during the month?
a. $0
b. $4,000
c. $6,000
d. $10,000
Additional Multiple Choice Questions
152. Which of the following is not part of the accounting process?
a. Recording
b. Identifying
c. Financial decision making
d. Communicating
153.The first part of the accounting process is
a. communicating.
b. identifying.
c. processing.
d. recording.
154.Keeping a systematic, chronological diary of events that are measured in dollars and cents is called
a. communicating.
b. identifying.
c. processing.
d. recording.
155. Auditing is
a. the examination of financial statements by a CPA in order to express an opinion on their fairness.
b. a part of accounting that involves only recording of economic events.
c. an area of accounting that involves such activities as cost accounting, budgeting, and accounting information systems.
d. conducted by the Securities and Exchange Commission to ensure that registered financial statements are presented fairly.
156.Internal users of accounting information include all of the following except
a. company officers.
b. investors.
c. marketing managers.
d. production supervisors.
157.The organization(s) primarily responsible for establishing generally accepted accounting principles is(are) the
FASBSEC
a.nono
b.yesno
c.noyes
d. yesyes
158.The primary accounting standard-setting body in the United States is the
a. Financial Accounting Standards Board.
b. International Accounting Standards Board.
c. Internal Revenue Service.
d. Securities and Exchange Commission.
159. A proprietorship is a business
a. owned by one person.
b. owned by two or more persons.
c. organized as a separate legal entity under state corporation law.
d. owned by a governmental agency.
160. A net loss will result during a time period when
a. assets exceed liabilities.
b. assets exceed stockholders' equity.
c. expenses exceed revenues.
d. revenues exceed expenses.
161. The Roy’s Downtown Diner received a bill of $400 from the Emeril Advertising Agency. The owner, Roy James, is postponing payment of the bill until a later date. The effect on specific items in the basic accounting equation is
a. a decrease in Cash and an increase in Accounts Payable.
b. a decrease in Cash and an increase in Retained Earnings.
c. an increase in Accounts Payable and a decrease in Retained Earnings.
d. a decrease in Accounts Payable and an increase in Retained Earnings.
162. Ryder Company purchases $600 of equipment from Montez Inc. for cash. The effect on the components of the basic accounting equation of Ryder Company is
a. an increase in assets and liabilities.
b. a decrease in assets and liabilities.
c. no change in total assets.
d. an increase in assets and a decrease in liabilities.
163. Fontaine Fox Company buys a $12,000 van on credit. The transaction will affect the
a. income statement only.
b. balance sheet only.
c. income statement and retained earnings statement only.
d. income statement, retained earnings statement, and balance sheet.