1. At December 31, 2016, Company A has assets of $430,000 and liabilities of $205,000. Based on this information and your understanding of the accounting equation, which of the following statements are true?
(There are multiple true statements and you must select only those that are true in order to get full credit for the question.)
Total stockholders' equity at December 31, 2016 equals $222,000.
2. Which of the following statements are false?
(There are multiple false statements and you must select only those that are false in order to get full credit for the question.)
A prepaid account is an expense account.
Consuming goods and services in the process of generating revenues results in expenses.
An example of an internal user of accounting information is the federal government.
The chart of accounts should be the same for all businesses.
Net income and net profit do not mean the same thing.
If the only changes in the company's account balances are a decrease in assets of $18,000 and an increase in liabilities of $15,000 in 2017, then total stockholders' equity will equal $230,000 at December 31, 2017.
If the only changes in the company's account balances are an increase in assets of $12,000 and an increase in liabilities of $15,000 in 2017, then total stockholders' equity will equal $222,000 at December 31, 2017.
Total stockholders' equity at December 31, 2016 equals $225,000.
If the only changes in the company's account balances are a decrease in assets of $8,000 and an increase in liabilities of $14,000 in 2017, then total stockholders' equity will equal $203,000 at December 31, 2017.