Circle the letter for the statement which bests answer each of the following: 1.
ID: 2597459 • Letter: C
Question
Circle the letter for the statement which bests answer each of the following: 1. Marcus has decided to open an auto-detailing business. He will pick up an automobile from the client, take it to his parents' garage, detail it, and return it to the client. If he does all of the work himself and takes no legal steps to form a special organization, which type of business organization, in effect, has he chosen? A) A limited-liability company B) A sole proprietorship C) A partnership D) A corporation 2. Posting a transaction means: A) calculating the balance in an account. B) finding the account number in the chart of accounts. C) transferring the data from the journal to the ledger D) recording the transaction including a brief explanation. Which of the following assumes that the financial statements of a business can be prepared for specific periods? A) time period concept B) matching principle C) revenue recognition principle D) adjusting entry principle 3. 4. The purposes of the adjusting process are A) to adjust expenses and revenues to the proper accrual basis. B) to adjust expenses and revenues as well as asset and liability balances to the proper accrual basis C) to adjust asset and liability balances to the proper accrual basis. D) none of the above 5. Having one person responsible for the related activities of ordering merchandise, receiving goods, and paying for them A) decreases the potential for errors and fraud. B) is an example of good internal control C) is a good example of safeguarding the company's assets. D) increases the potential for errors and fraud. Acct 204 Final Fall 2017 Page 2AExplanation / Answer
Answer:
1.b.Sole proprietorship
2.c.transferring the data from journal to ledger
3.a.Time period concept
4.b.to adjust expenses and revenues as well as asset and liability balances to the proper accrual basis.
5.d.increase the potential for errors and fraud
6.c.Buyer normally pays the transportation costs
7.a. first in first out
8.b.it is shown as contra account related to accounts receivable
9.d.Book value
10.c.it creates a present obligation for future payment of cash or services
11.b
12.b.paid in capital and retained earnings
13.a.decreases the number of shares outstanding
14.c.Dividends are a distribution of cash, stock or other property to stockholders
15.d.Balance in common stock remains the same.