Accounting

Card Set Information

Author:
hayley731
ID:
7526
Filename:
Accounting
Updated:
2010-02-21 01:56:09
Tags:
True or False
Folders:

Description:
Chapter 14
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  1. A stockholder is an owner of more shares of a corporation.
    True
  2. Owners' equity accounts for a corporation normally are listed under a major chart of accounts division titled Capital Stock.
    False
  3. A dividend is an amount earned by a corporation and not yet distributed to stockholders.
    False
  4. A dividends account has a normaldebit balance and is increased by a debit.
    True
  5. A group of persons elected by the stockholders to manage a corporation is called a board of directors.
    True
  6. A board of directors distributes earnings of a corporation to stockholders by declaring a dividend.
    True
  7. A declared dividend is classified as an expense.
    False
  8. The accounts used to record the declaration of a dividend are Dividends Payable and Dividends Expense.
    False
  9. Retained earnings are earnings distributed to stockholders.
    False
  10. When a declared dividend is paid, Dividends Payable is debited.
    True
  11. The purpose of a work sheet is to plan adjustments and summarize the info necessary to prepare financial statements.
    True
  12. The Prepaid Insurance account is adjusted to show the value of insurance that has been used.
    True
  13. During a fiscal period, the amount of merchandise on hand increases and decreases.
    True
  14. Most accounts needing adjustment at the end of a fiscal period have a related temporary account.
    True
  15. The risk of uncollectible accounts should be recorded as an expense in the same accounting period that the revenue is earned.
    True
  16. The account Allowance for Uncollectible Accounts is a contra account.
    True
  17. Many businesses use a percentage of total sales on account to esimate uncollectible accounts expense.
    True
  18. Assets that will be used for a number of years in the operation of a business are called current assets.
    False
  19. Accumulated depreciation is the depreciation expense that has been recorded since the purchase of a plant asset.
    True
  20. Federal income tax is an expenseof a corporation.
    True

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