1. allocates an intangible asset, such as a copyright or patent.

a) Depreciation

b)Accounts Payable

c)Accounts Receivable

d)Amortization

2. A corporation is legally permitted to maintain two sets of financial statements, one for tax purposes and one for public reporting.

a) True

b) False

3. Assets on a balance sheet are listed from:

a) least liquid to most liquid.

b) A to Z alphabetically.

c) largest dollar amount to lowest dollar amount.

d) most liquid to least liquid.

4. Any liability listed as "current" on a balance sheet should be paid within one year:

a) after the balance sheet date.

b) before the balance sheet date.

c) to five years.

d) from the date the company was founded.

5. A fixed asset has a useful life longer than one year and may be:

a) cash and accounts receivable.

b) inventory.

c) revenue and expenses.

d) a building, piece of equipment or vehicle.

6. When a restaurant buys a new oven to cook meals for the next five years, this use of cash is for what type of activity?

a) Financing Activity

b) Operating Activity

c) Investing Activity

7. When an airline, such as United or Southwest, transports passengers by plane to various airports, it has cash inflow from what type of activity?

a) Financing Activity

b) Investment Activity

c) Operating Activity