Questions:
1: Stewardship is an important concept because of:
The separation of ownership from management
The need to increase shareholder wealth
The importance of the quality of decisions by small business owners
The need to recognize the importance of all stakeholders
2: Financial statements are regulated by:
Legislation and accounting standards
Accounting standards and audit
Legislation, accounting standards and audit
The accounting profession
3: The Income Statement comprises the following groups of accounts:
Assets and Liabilities
Income, Expenses and Equity
Assets, Liabilities and Equity
Income and Expenses
4: Paying cash for a computer system for business use would affect the following types of account:
Both assets and liabilities
Liabilities only
Assets only
Both assets and expenses
5: Use the following information to answer Questions 3-4 to 3-8 (12-16). Kochyo purchases an inventory of spare parts on credit from its suppliers for $15,000. During the month Kochyo pays its suppliers $10,000 and sells spare parts (which cost the business $8,000) to its customers on credit for $20,000. Customers pay Kochyo $12,000 during the month.
6: Profit increases by:
$7,000
$8,000
$12,000
$5,000
$2,000