Forms of business organization

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Reference no: EM1315800

Accounts Basics and cash flow statement related multiple Choice questions.

1. Which of the following is not one of the three forms of business organization?

a. corporations.

b. partnerships.

c. proprietorships.

d. investors.

2. Which of the following would not be considered an internal user of accounting data for the XYZ Company?

a. President of the company

b. Production manager

c. Merchandise inventory clerk

d. President of the employees' labor union

3. Which of the following groups uses accounting information to determine whether the company can pay its obligations?

a. Investors in common stock

b. Marketing managers

c. Creditors

d. Chief Financial Officer

4. Which of the following groups uses accounting information to determine whether the company's net income will result in a stock price increase?

a. Investors in common stock

b. Marketing managers

c. Creditors

d. Chief Financial Officer

5. External users want answers to all of the following questions except

a. Is the company earning satisfactory income?

b. Will the company be able to pay its debts as they come due?

c. Will the company be able to afford employee pay raises this year?

d. How does the company compare in profitability with competitors?

6. Which type of corporate information is not available to investors?

a. dividend history

b. forecast of cash needs for the upcoming year

c. cash provided by investing activities

d. beginning cash balance

7. The liability created by a business when it purchases coffee beans and coffee cups on credit from suppliers is termed a(n)

a. account payable.

b. account receivable.

c. revenue.

d. expense.

8. The right to receive money in the future is called a(n)

a. account payable.

b. account receivable.

c. liability.

d. revenue.

9. Borrowing money is an example of a(n)

a. delivering activity.

b. financing activity.

c. investing activity.

d. operating activity.

10. The statement of cash flows would disclose the payment of a dividend

a. nowhere on the statement.

b. in the operating activities section.

c. in the investing activities section.

d. in the financing activities section.

Reference no: EM1315800

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