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Exam 7: Financing and Accounting

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Question 1

Multiple Choice

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The catalog of items maintained by a business, which lists the description, quantity, item number, unit cost, and total cost of each item the business carries, is known as a(n) ________.

A) payroll record
B) expense account
C) inventory account
D) check register

Correct Answer

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C

Question 2

Multiple Choice

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A(n) ________ is a listing of each type of activity (expense) and each asset within the company.

A) systems account
B) accrual account
C) chart of accounts
D) inventory account

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Question 3

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A ________ is a contractual agreement where a business receives money that must be repaid over a period of time.

New businesses need to be aware of what issue(s) related to start-up?

A bank provides John money for the necessary hamburger maker for his business.This is called ________.

A profit and loss statement represents your business performance over time.

The difference between what is sold and what was brought into the system is called ________.

Of the key accounting reports that a new businessperson should be prepared to generate, which of the following tracks the work times of hourly employees and attendance for salaried employees?

In the context of equity funding, identify a characteristic of venture capital funds.

Debt, a source of non-equity funding, allows a new business to handle the disparity between when goods must be purchased and when money will be received from a customer to pay for those goods.

________ are high-net-worth individuals who invest in businesses not as a business, but on an individual basis.

Shrinkage is the difference between inventory that has been sold and inventory that was purchased by the business.

In the context of non-equity funding, identify a true statement about loans.

In the context of managing data flows, the ________ of inventory control seeks to minimize excess capital investment in inventory.

Covore Inc., a start-up firm, receives the majority of the funds it requires to begin its operations from five individuals.In exchange for these funds, each individual receives a share of ownership in the firm.The funds provided to Covore Inc.by the individuals are an example of ________.

________ can be described as a form of non-equity funding where one organization finances another organization's purchasing of physical assets and supplies.

Founders cannot lend money to their own firm.

A cash-based accounting system recognizes expenses as they are paid and recognizes revenue when it is generated.

Equity investment does not involve selling a percentage of the business to an outside investor.

Accepting ________ ties a firm to the supplier and usually stops the firm from shopping around for a lower price.