Decisions, Decisions | Busy Month, Bigger Commitment?

About This Exercise

Block Party Print Co. has completed its first month in business and is considering a large, time-sensitive customer opportunity. Students use transaction analysis and the accounting equation to distinguish cash on hand from the sources and commitments behind that cash, then evaluate the decision using accounting evidence rather than one headline balance.

Faculty/Pearson Demonstration: This webpage demonstrates how students complete a Decisions, Decisions exercise. In the course assignment, questions are selected from a randomized pool of approximately 50 questions. The eight questions shown here are demonstration variants. They are different from the course questions but are structured similarly and address the same learning objectives.

The activity creates productive friction by requiring students to interact with the video before answering. The questions depend on specific amounts, transaction details, combinations of facts, and judgments presented in the video, then ask students to calculate, interpret, or apply accounting concepts to that evidence.

In the actual Pearson assignment, students receive one question at a time, cannot return to an earlier question, and receive one attempt only. All eight questions appear together on this webpage only so faculty and Pearson reviewers can examine the complete demonstration.

The video is hosted on YouTube for this demonstration. YouTube content may be more readily accessible to AI-enabled browsers that can analyze video. Delivery through the Pearson media player would make the video harder for many AI-enabled browsers to capture. That additional access barrier, together with randomized video-dependent questions, one-question-at-a-time delivery, no backtracking, and one-attempt scoring, would strengthen AI resistance while preserving the accounting learning objective.

Watch the Video

Length: 16 minutes

Open the video in a new window

Answer the Questions

8 questions total

For this faculty demonstration, all eight questions are visible together. In the actual assignment, questions are presented one at a time, students cannot return to an earlier question, and each question allows one attempt only.

Question 1 of 8
1. According to the video’s cash-source analysis, how much of the total cash received during the month came from sources other than customer print jobs? $30,000 $38,000 $48,000 $68,000

Question 2 of 8
2. The video shows that Block Party Print Co. paid cash for equipment during its first month. How much cash was used for that equipment purchase? $18,000 $20,000 $24,000 $30,000

Question 3 of 8
3. Using the first-month results presented in the video, how much stockholders’ equity came from earnings that remained in the company after the dividend? $6,000 $14,000 $30,000 $5,000

Question 4 of 8
4. According to the video, which two groups of cash expenses combined to produce the company’s $14,000 of first-month expenses? Rent, wages, and utilities of $12,000 plus advertising of $2,000 Supplies and utilities of $10,000 plus advertising of $4,000 Rent and advertising of $11,000 plus wages of $3,000 Wages and utilities of $8,000 plus supplies of $6,000

Question 5 of 8
5. After considering revenue, expenses, and dividends, what two amounts does the video use to distinguish first-month profit from the earnings actually retained in the business? $20,000 profit and $14,000 retained $6,000 profit and $5,000 retained $23,000 profit and $18,000 retained $5,000 profit and $6,000 retained

Question 6 of 8
6. The video describes Block Party Print Co. as profitable during its first month. Which amount represents that first-month profit? $5,000 $6,000 $20,000 $23,000

Question 7 of 8
7. Using the month-end accounting equation presented in the video, approximately what percentage of Block Party Print Co.’s total assets is financed by liabilities? 18% 25% 53% 34%

Question 8 of 8
8. At the end of the first month, which combination of asset balances does the video show for Block Party Print Co.? Cash $23,000; supplies $6,000; equipment $24,000 Cash $23,000; supplies $24,000; equipment $6,000 Cash $18,000; supplies $6,000; equipment $29,000 Cash $30,000; supplies $5,000; equipment $18,000

Performance by Skill

Key takeaway: A cash balance is only one piece of the decision. Transaction analysis shows where cash came from, what the company owns, what it owes, and how revenues, expenses, and dividends affected stockholders’ equity. Those relationships provide a stronger basis for business judgment than cash alone.