Reference no: EM13928371

1. Hardin Company began operations in 2010. During the year, the following cash transactions occurred:

• Issued stock for $40,000
• Borrowed $24,000 from bank
• Provided services to customers for $53,000 cash
• Paid back $8,000 of the loan from the bank
• Paid rent expense, $9,000
• Paid operating expenses, $29,000

Assuming that Hardin engaged in no transactions during the year other than those listed above, what was the amount of net income or loss for the year?

• $19,000 net income
• $15,000 net income
• $12,000 net income
• $11,000 net loss

Question 2. Dale Company purchased land costing $2,400 by paying cash. The company earned $2,000 revenue on account and incurred $1,100 of operating expenses on account. As a result of these transactions:

Total assets increased by $2,400.

Liabilities increased by $1,100.

Total assets increased by $5,400.

Both A and B.

Question 3. Liabilities are:

• claims of creditors.
• the owner's interest in the company.
• claims of investors.
• both A and B.

Question 4. Parrot Company paid a $300 cash dividend. Which of the following choices accurately reflects how this event would affect the company's financial statements?

Balance Sheet Income Statement Row Assets = Liab. + Equity Rev. - Exp. = Net Inc.

Statement of Cash Flows

One	NA	=	300	+	(300)	NA	-	300	=	(300)	NA
Two	(300)	=	NA	+	(300)	NA	-	300	=	(300)	(300) FA
Three	(300)	=	NA	+	(300)	NA	-	NA	=	NA	(300) FA
Four	(300)	=	NA	+	(300)	NA	-	NA	=	NA	(300) OA

• Row One
• Row Two
• Row Three
• Row Four

Question 5. At the end of the accounting period, Sefcik Company made an adjusting entry for supplies consumed. Which of the following choices reflects how this event would affect the company's financial statements?

Row	Assets	=	Liab.	+	Equity	Rev.	-	Exp.	=	Net Inc.	Cash Flow
One	+ -	=	NA	+	NA	NA	-	+	=	-	NA
Two	-	=	NA	+	-	NA	-	+	=	-	NA
Three	-	=	-	+	NA	NA	-	NA	=	NA	NA
Four	+ -	=	NA	+	NA	NA