41.The sale of additional shares of capital stock will cause treasury stock to increase. True False42.In addition to the three basic financial statements, which of the following is also a required financial statement? the "Cash Budget" the Statement of Cash Flows the Statement of Cash Inflows and Outflows the "Cash Reconciliation"43.If a company purchases equipment with cash, its total assets will increase. True False44.If a depreciable asset's market value increases during the year, no depreciation expense should be recorded. True False45.One of the purposes of adjusting entries is to convert assets to expenses. True False46.In which type of a business, the owner and his business are not considered same in the eyes of law? (a) Sole proprietorship (b) Limited companies (c) Partnership (d) a and c47.Which of the following is not a capital expenditure? A. Advertising expenditures to introduce a new product line. B. Sales tax paid in conjunction with the purchase of new machinery. C. Installation of elevators to replace escalators. D. An amount paid to acquire a patent with a remaining life of only three years.48.Liabilities are usually listed in order of magnitude, from smallest dollar amount to largest dollar amount. True False49._____ are the property or economic resources that are expected to provide a future benefit to a business. Capital Revenue Expenses Assets50.If a company reports a net loss, it may still have a net increase in cash. will not be able to pay cash dividends. will not be able to get a loan. will not be able to make capital expenditures.

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Answered: he sale of additional shares of capital…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

41.

The sale of additional shares of capital stock will cause treasury stock to increase.

True

False

42.

In addition to the three basic financial statements, which of the following is also a required financial statement?

		the "Cash Budget"
		the Statement of Cash Flows
		the Statement of Cash Inflows and Outflows
		the "Cash Reconciliation"

43.

If a company purchases equipment with cash, its total assets will increase.

True

False

44.

If a depreciable asset's market value increases during the year, no depreciation expense should be recorded.

True

False

45.

One of the purposes of adjusting entries is to convert assets to expenses.

True

False

46.

In which type of a business, the owner and his business are not considered same in the eyes of law?

		(a) Sole proprietorship
		(b) Limited companies
		(c) Partnership
		(d) a and c

47.

Which of the following is not a capital expenditure?

		A. Advertising expenditures to introduce a new product line.
		B. Sales tax paid in conjunction with the purchase of new machinery.
		C. Installation of elevators to replace escalators.
		D. An amount paid to acquire a patent with a remaining life of only three years.

48.

Liabilities are usually listed in order of magnitude, from smallest dollar amount to largest dollar amount.

True

False

49.

_____ are the property or economic resources that are expected to provide a future benefit to a business.

		Capital
		Revenue
		Expenses
		Assets

50.

If a company reports a net loss, it

		may still have a net increase in cash.
		will not be able to pay cash dividends.
		will not be able to get a loan.
		will not be able to make capital expenditures.

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