The costs of providing goods and services to customers are referred to as:

21. The costs of providing goods and services to customers are referred to as: 

A. Assets.
B. Expenses.
C. Liabilities.
D. Revenues.

22. The accounts which represent the resources of the company are called:
A. Liabilities.
B. Revenues.
C. Expenses.
D. Assets.

23. An alternative form of the accounting equation is:
A. Net Income = Revenues - Expenses.
B. Stockholders' Equity = Assets + Liabilities.
C. Assets = Liabilities - Stockholders' Equity.
D. Assets - Liabilities = Stockholders' Equity.

 

24. The owners' interest in a corporation is called:
A. Dividends.
B. Assets.
C. Liabilities.
D. Stockholders' equity.

25. Creditors' claims to a corporation's resources are referred to as:
A. Dividends.
B. Assets.
C. Liabilities.
D. Stockholders' equity.

26. Net income can best be described as:
A. Net cash received by a company during the year.
B. Revenues minus expenses.
C. The amount of profits retained in a company for the year.
D. Resources owned by a company.

27. Use the following appropriate amounts to calculate net income: Revenues, $12,000; Liabilities, $5,000; Expenses, $4,000; Assets, $19,000; Dividends, $4,000.
A. $6,000.
B. $8,000.
C. $4,000.
D. $14,000.

Revenues ($12,000) - Expenses ($4,000) = Net Income.

28. Liabilities are best defined as:
A. Amounts the company expects to collect in the future from customers.
B. Debts or obligations the company owes resulting from past transactions.
C. The amounts that owners have invested in the business.
D. Payments to stockholders.

29. Which of the following best describes a revenue?
A. Resources owned.
B. Cash received from a customer.
C. Amounts earned from providing goods and services to a customer.
D. Dividends paid to stockholders.

30. The account type that represents payments to stockholders is called:
A. Liabilities.
B. Assets.
C. Stockholders' equity.
D. Dividends.