58.Which of the following does not correctly describe business transactions or events?
A. They include exchanges of assets or services by one business for assets, services, or promises to pay from another business.
B. They include the using up of insurance paid for in advance.
C. They have an economic impact on a business entity.
D. They do not include measurable internal events such as the use of assets in operations.
59.Which of the following would not be included under the account category of expenses within the chart of accounts?
A. Cost of goods sold.
B. Interest expense.
C. Prepaid insurance expense.
D. Income tax expense.
60.Which of the following liability accounts does not usually require a future cash payment?
A. Accounts payable.
B. Unearned revenues.
C. Taxes payable.
D. Notes payable.
61.Which of the following transactions would not be considered an external exchange?
A. The purchase of supplies on credit.
B. Cash received from the issuance of common stock.
C. Cash paid to a bank for interest on a loan.
D. Using up insurance, which had been paid for in advance.
62.Which of the following reflects the impact of a transaction where $200,000 cash was invested by stockholders in exchange for stock?
A. Assets and retained earnings each increased $200,000.
B. Assets and revenues each increased $200,000.
C. Stockholders' equity and revenues each increased $200,000.
D. Stockholders' equity and assets each increased $200,000.
63.A corporation purchased factory equipment using cash. Which of the following statements regarding this purchase is correct?
A. The cost of the factory equipment is an expense at the time of purchase.
B. The total assets will not change.
C. The total liabilities will increase.
D. The current stockholders' equity will decrease.
64.Which of the following direct effects on the accounting equation is not possible as a result of a single business transaction which impacts only two accounts?
A. An increase in a liability and a decrease in an asset.
B. An increase in stockholders' equity and an increase in an asset.
C. An increase in an asset and a decrease in an asset.
D. A decrease in stockholders' equity and a decrease in an asset.
65.Which of the following direct effects on the accounting equation is not possible as a result of a single business transaction which impacts only two accounts?
A. An increase in an asset and a decrease in another asset.
B. An increase in an asset and an increase in stockholders' equity.
C. A decrease in stockholders' equity and an increase in an asset.
D. An increase in a liability and an increase in an asset.
66.A company's January 1, 2016 balance sheet reported total assets of $150,000 and total liabilities of $60,000. During January 2016, the company completed the following transactions: (A) paid a note payable using $10,000 cash (no interest was paid); (B) collected a $9,000 accounts receivable; (C) paid a $5,000 accounts payable; and (D) purchased a truck for $5,000 cash and by signing a $20,000 note payable from a bank. The company's January 31, 2016 balance sheet would report which of the following?
A. AssetsLiabilitiesStockholder's Equity
B. AssetsLiabilitiesStockholder's Equity
C. AssetsLiabilitiesStockholder's Equity
D. AssetsLiabilitiesStockholder's Equity
67.Which of the following is a result of equipment purchased with cash?
A. Total assets decrease.
B. Current assets do not change.
C. Current assets increase.
D. Stockholders' equity does not change.