Section 2 (Marks: 80) Multiple Choice (Circle the correct answer) 1) Which of the following statements best describes managerial accounting? (1 mark) A) Managerial accounting focuses on information for internal decision making. B) Managerial accounting focuses on outside investors and lenders. C) Managerial accounting provides information for the public. D) Managerial accounting provides information for taxing authorities. Answer: 2) Which of the following is a feature of limited-liability partnerships? (1 mark) A) They are restricted to a limited number of partners who are liable for the business. B) Liability is limited to 150% of each partners investment in the business. C) Partner liability is unlimited but the liability of partner families is limited. D) Each partner is liable for his or her own actions. Answer: 3) GAAP stands for: ( 1 mark) A) generally accepted auditing practices. B) generally accrued auditing procedures. C) generally accepted accounting principles. D) generally accrued accounting principles. Answer: 4) The accounting equation can be stated as: (1 mark) A) Assets = Liabilities - Owner's Equity. B) Assets - Liabilities = Owner's Equity. C) Liabilities = Assets + Owner's Equity. D) Owner's Equity = Assets + Liabilities. Answer 15) On September 1, 2014, Two Sisters Company pays $36,000 cash for six months rent. The bal prepaid rent on December 31,2014 , after adjustment, would be: ( 1 mark) A) $6,000. B) $24,000. C) $12,000. D) $0. Answer: 16) A business pays weekly salaries on Friday of $25,000 for a five-day week ending on Friday the fiscal period ends on a Wednesday, the adjusting entry for accrued salaries would involve A) debit to salary payable for $10,000. B) debit to salary expense for $15,000. C) credit to salary payable for $10,000. D) credit to salary expense for $15,000. Answer: 17) The balance in prepaid rent after adjustment represents: ( 1 mark) A) a liability on the balance sheet. B) an expense on the income statement. C) revenue on the income statement. D) an asset on the balance sheet