True or False
1. ____ The income statement gives company’s revenues and expenses for one particular day of the year.
2. ____ An increase in net assets of a business due to the sale of its inventory is a gain.
3. ____ Retained earnings represents amounts contributed to the business by its owners.
4. ____ Assets and liabilities can be broken down into the categories of current and noncurrent.
5. ____ Income tax expense is typically reported separately from other expenses.
6. ____ Conservatism helps companies look better to potential investors.
7. ____ Dividends paid are reported on the balance sheet.
8. ____ Companies receive money each time their stock is sold on a stock exchange.
9. ____ A balance sheet should always balance.
10. ____ The statement of cash flows is broken up into operating, investing, and financing activities.
11. ____ Notes are considered part of a complete set of financial statements.
12. ____ Sales revenue less cost of goods sold is referred to as net income.
13. ____ A gain is the amount of net income earned by a company over its life less any dividends it has paid.
14. ____ The purpose of the balance sheet is to report the assets and liabilities of a company on a specific date.
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