Home work 1 ( Candidate Name : Islam Samir Ali– 1WF )

Use the following to answer questions 1-5:

At December 31, the accounting records of Jaller Corporation contain the following
items:
A cc o u nts P a y ab le .................... $ 2 4 ,0 0 0 A cc o un ts R ece iv ab le ............... $ 6 0 ,0 0 0
L an d ........................................ 3 6 0 ,0 0 0 C ash ......................................... ?
C ap ital Sto c k ........................... ? E q u ip m en t ............................... 1 8 0 ,0 00
B u ild in g .................................. 2 5 0 ,0 0 0 N o te s P ay ab le .......................... 2 8 0,0 0 0
R e tain e d E a rn in g s .................... 2 50 ,0 00

1. Refer to the above data. If Capital Stock is $400,000, the amount of Cash owned by
Jaller Corporation at December 31, is:
A) $924,000.
B) $214,000.
C) $104,000.
D) $684,000.

2. Refer to the above data. If Capital Stock is $550,000, total assets of Jaller Corporation
at December 31, amount to:
A) $ 1,104,000.
B) $ 810,000.
C) $1,024,000.
D) $ 834,000.

3. Refer to the above data. If Cash at December 31, is $94,000, Capital Stock is:
A) $904,000.
B) $330,000.
C) $390,000.
D) $524,000.

4. Refer to the above data. If Cash at December 31, is $24,000, total owners' equity is:
A) $834,000.
B) $310,000.
C) $584,000.
D) $570,000.

5. Refer to the above data. If Cash at December 31, is $64,000, total assets amount to:
A) $ 746,000.
B) $ 824,000.
C) $ 914,000.
D) $1,124,000.

Prof. Eltemsahi MBA H.W. 1

 6. Profitability may be defined as:
The ability to pay the debts of the company as they fall due.
The ability to increase the value of retained earnings.
Distributing dividends
Having excess cash
7. A net loss will result during a time period when
a. liabilities exceed assets.
b. drawings exceed investments.
c. expenses exceed revenues.
d. revenues exceed expenses.
8. The accounting equation for Cineo Eyewear is as follows:
Assets Liabilities Owner’s Equity
£120,000 = £60,000 + £60,000
If Cineo purchases office equipment on account for £15,000, the accounting
equation will change to
Assets Liabilities Owner’s Equity
a. £120,000 = £60,000 + £60,000
b. £135,000 = £60,000 + £75,000
c. £135,000 = £67,500 + £67,500
d. £135,000 = £75,000 + £60,000

9. If expenses are paid in cash, then

a. assets will increase.
b. liabilities will decrease.
c. owner's equity will increase.
d. assets will decrease.
10. The ending owner's equity amount is shown on
a. the statement of financial position only.
b. the owner's equity statement only.
c. both the income statement and the owner's equity statement.
d. both the statement of financial position and the owner's equity statement
11. Akemi’s Service Shops started the year with total assets of ¥32,000,000 and total
liabilities of ¥24,000,000. During the year, the business recorded ¥63,000,000 in
revenues, ¥45,000,000 in expenses, and owner drawings of ¥6,000,000.
Owner’s equity at the end of the year was
a. ¥8,000,000.
b. ¥20,000,000.
c. ¥31,000,000.
d. ¥37,000,000.

Prof. Eltemsahi MBA H.W. 1