The concept of interperiod equity relates to whether: A) Current period revenues are sufficient to pay for current period services. B) Current assets are larger than current liabilities. C) The organization enforces a policy of tax equity. D) All of the above.

In general, how does the income statement help satisfy the objectives of financial reporting?

Explain how the following items affect equity: revenue, expenses, investments by owners, and distributions to owners.

Which of the following principles matches expenses with associated revenues in the period in which the revenues were generated? A. revenue recognition principle B. expense recognition (matching) principle C. cost principle D. full disclosure principle

Which of the following is not a criterion to recognize revenue under GAAP? A. The earnings process must be completed. B. A product or service must be provided. C. Cash must be collected. D. GAAP requires that the accrual basis accounting principle be used in the revenue recognition process.

Which option is the correct definition of tax base? Select one: a. Tax base is the amount the asset or liability is recorded at in the accounting records. b. Tax base is a comparing the balance sheet derived using accounting rules with balance sheet that would be derived from taxation rules c. Tax base is the recognition of assets and liabilities in the balance sheet based on the differences between accounting and tax values of assets and liabilities. d. Tax base is defined as the amount that is attributed to an asset or liability for tax purposes.

Listed below are several terms and phrases associated with income statement presentation and the statement ofcash flows. Pair each item from List A (by letter) with the item from List B that is most appropriately associatedwith it.List A List B_____ 1. Intraperiod tax allocation_____ 2. Comprehensive income_____ 3. Unrealized holding gain oninvestments_____ 4. Operating income_____ 5. A discontinued operation_____ 6. Earnings per share_____ 7. Prior period adjustment_____ 8. Financing activities_____ 9. Operating activities (SCF)_____ 10. Investing activities_____ 11. Direct method_____ 12. Indirect methoda. An other comprehensive income itemb. Starts with net income and works backwards to convert tocashc. Reports the cash effects of each operating activity directly onthe statementd. Correction of a material error of a prior periode. Related to the external financing of the companyf. Associates tax with income statement itemg. Total nonowner change in equityh. Related to the…

8. Income is: a. An amount for payment of services, interest, or profit from investment b. The gain derived from capital or labor c. Any material gain, not otherwise excluded by law, realized out of a closed and completed transaction, where there is an exchange of economic value for economic value, with a specified taxable period, under the method of accounting employed. d. A flow of service rendered by capital by the payment of money from it or any other benefit rendered by a fund of capital in relation to such fund through a period of time.

Which of the following is an External sources of finance? a.Depreciation funds b.Retained earnings c.Loans from Banks and Financial institutions d.Surplus

Define the following. a. Retained earnings? b. Goodwill? c. Investing activities?