problem1: The cost of an asset and its fair market value are;

[A] Irrelevant when the asset is used by the business in its operations

[B] The same on the date of acquisition

[C] Never the same

[D] The same when the asset is sold

problem2: Communication of economic events is the part of the accounting process that involves;

[A] Preparing accounting reports.

[B] Recording and classifying information.

[C] Identifying economic events.

[D] Quantifying transactions into dollars and cents.

problem3: The left side of an account is

[A] The debit side

[B] The balance of the account

[C] Blank

[D] A description of the account

problem4: An accountant has debited an asset account for $1,000 and credited a liability account for $500. Which of the following would be an incorrect way to complete the recording of the transaction?

[A] Credit and stockholders' equity account for $500.

[B] Debit and stockholders' equity account for $500.

[C] Credit an asset account for $500.

[D] Credit another liability account for $500.

problem5: Generally accepted accounting principles are;

[A] theories that are based on physical laws of the universe.

[B] principles that have been proven correct by academic researchers.

[C] income tax regulations of the Internal Revenue Service.

[D] standards that indicate how to report economic events.