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1. What is the primary purpose of the statement of financial position? A. To measure the profit of a business up to a particular point in time. B. To report the difference between cash inflows and cash outflows for the period. C. To report the financial position of the reporting entity at a particular point in time. D. To report assets at their current market value at a particular point in time. 2. On January 1, 20A, two individuals invested $150,000 each to form Hornbeck Corporation. Hornbeck had total revenues of $15,000 during 20A and $40,000 during 20B. Total expenses for the same periods were $8,000 and $22,000, respectively. Cash dividends paid out to shareholders totalled $6,000 in 20A and $12,000 in 20B. What was the ending balance in Hornbeck's retained earnings account at the end of 20A and 20B? A. $1,000 and $6,000 respectively. B. $1,000 and $7,000, respectively. C. $7,000 and $19,000 respectively. D. $301,000 and $306,000 respectively. 3. The BAT Corporation had revenues of $110,000, expenses of $85,000, and an income tax rate of 20 percent in 20B. What would profit after taxes be? A. $5,000. B. $15,000. C. $20,000. D. $25,000. 4. Brown Corporation reported the following amounts at the end of the first year of operations, December 31, 20A: share capital $20,000; sales revenue $95,000; total assets $85,000, no dividends, and total liabilities $35,000. What would shareholders' equity and total expenses be? A. Shareholders' equity, $50,000 and expenses $65,000. B. Shareholders' equity, $60,000 and expenses $75,000. C. Shareholders' equity, $80,000 and expenses $40,000. D. Shareholders' equity, $80,000 and expenses $85,000. 5. Which of the following would not be considered an internal user of accounting data? A. The president of a company. B. The controller of a company
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