Question 1

The __________ is an accounting statement that reports the financial condition of a firm at a specific point in time.

Accepted Answer

A) income statement 
B) balance sheet 
C) cash flow statement 
D) trial balance 
A) income statement 
B) balance sheet 
C) cash flow statement 
D) trial balance

Question 2

A(n)_________ is a yearly statement of the financial condition,progress and expectations of an organization.

Accepted Answer

A) balance sheet 
B) independent audit 
C) mission statement 
D) annual report 
A) balance sheet 
B) independent audit 
C) mission statement 
D) annual report

Question 3

The accounting system happens once a year.

Accepted Answer

A) True 
 B)False

Question 4

The balance sheet reflects the fact that assets equal the sum of liabilities and owners' equity.

Accepted Answer

A) True 
 B)False

Question 5

Accountants do most of the work involved in recording financial events and transactions,but the actual classifying and interpreting of this data is left to financial managers.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following would be classified as a general expense on an income statement?

Accepted Answer

A) salaries paid to salespeople 
B) dividends paid to stockholders 
C) payments made for insurance 
D) costs associated with an advertising campaign 
A) salaries paid to salespeople 
B) dividends paid to stockholders 
C) payments made for insurance 
D) costs associated with an advertising campaign

Question 7

The three key financial statements of a business are the

Accepted Answer

A) ledger,journal,and trial balance. 
B) cash budget,capital budget,and master budget. 
C) revenue summary,expense summary,and consolidation statement. 
D) balance sheet,income statement,and cash flow statement. 
A) ledger,journal,and trial balance. 
B) cash budget,capital budget,and master budget. 
C) revenue summary,expense summary,and consolidation statement. 
D) balance sheet,income statement,and cash flow statement.

Question 8

If the goal of a business is to pay lower taxes on its income during an inflationary period,it is likely to use the FIFO inventory costing method.

Accepted Answer

A) True 
 B)False

Question 9

Generally,a high ___________ ratio could lead investors and creditors to view the company as being very risky.

Accepted Answer

A) debt to owners' equity 
B) acid test 
C) diluted earnings per share 
D) inventory turnover 
A) debt to owners' equity 
B) acid test 
C) diluted earnings per share 
D) inventory turnover

Question 10

The value of things you own minus the amount of money you owe others is called equity.

Accepted Answer

A) True 
 B)False

Question 11

As an accountant,Joe Billings would be most likely to be involved in:

Accepted Answer

A) developing plans to help his company establish a supply chain. 
B) setting prices for specific goods. 
C) summarizing and interpreting financial information needed by his firm's managers. 
D) developing a fringe benefit program that improves employee morale. 
A) developing plans to help his company establish a supply chain. 
B) setting prices for specific goods. 
C) summarizing and interpreting financial information needed by his firm's managers. 
D) developing a fringe benefit program that improves employee morale.

Question 12

A major part of a bookkeeper's job is to interpret financial data and suggest strategies for improving the firm.

Accepted Answer

A) True 
 B)False

Question 13

Careful consideration of the use of computers in accounting indicates that computers:

Accepted Answer

A) will soon eliminate all of the accounting functions. 
B) are tools to help the accountant perform his or her job. 
C) cannot handle the increasing data demands of accounting. 
D) have a very limited use in accounting due to inadequate privacy controls. 
A) will soon eliminate all of the accounting functions. 
B) are tools to help the accountant perform his or her job. 
C) cannot handle the increasing data demands of accounting. 
D) have a very limited use in accounting due to inadequate privacy controls.

Question 14

You have just computed the basic earnings per share (basic EPS)for a company in which you hold some stock.You then find out that the company recently issued preferred stock and has included additional stock options in the compensation package for top executives that you were unaware of when you computed the basic EPS.This additional knowledge:

Accepted Answer

A) means that the basic EPS you calculated is incorrect,and the true ratio will be higher once the impact of preferred shares and stock options is included. 
B) means that the basic EPS you calculated is incorrect,and the true ratio will be lower once the impact of preferred shares and stock options is included. 
C) would have no impact on the value of the basic EPS calculation. 
D) means that the basic EPS you calculated is incorrect,but the true value of the ratio could be either higher or lower because the use of preferred stock and the use of stock options affect the basic EPS in opposite directions. 
A) means that the basic EPS you calculated is incorrect,and the true ratio will be higher once the impact of preferred shares and stock options is included. 
B) means that the basic EPS you calculated is incorrect,and the true ratio will be lower once the impact of preferred shares and stock options is included. 
C) would have no impact on the value of the basic EPS calculation. 
D) means that the basic EPS you calculated is incorrect,but the true value of the ratio could be either higher or lower because the use of preferred stock and the use of stock options affect the basic EPS in opposite directions.

Question 15

One of the major financial statements prepared in the fifth step of the accounting cycle is the:

Accepted Answer

A) general journal. 
B) cash flow statement. 
C) asset summary. 
D) social audit. 
A) general journal. 
B) cash flow statement. 
C) asset summary. 
D) social audit.

Question 16

Salaries of salespeople and advertising costs are common examples of general expenses.

Accepted Answer

A) True 
 B)False

Question 17

During a period of rising prices,if a firm desired to report a low net income figure in hopes of reducing their income tax liability,the firm would use the ________ inventory valuation method.

Accepted Answer

A) FIFO (first in,first out) 
B) LIFO (last in,first out) 
C) sliding scale 
D) average cost 
A) FIFO (first in,first out) 
B) LIFO (last in,first out) 
C) sliding scale 
D) average cost

Question 18

Perry is responsible for recording all sales transactions that take place at Turncoat Enterprises.He must be careful that his recording is both accurate and thorough.Perry's work involves tasks associated with:

Accepted Answer

A) auditing. 
B) capital budgeting. 
C) bookkeeping. 
D) revenue assessment. 
A) auditing. 
B) capital budgeting. 
C) bookkeeping. 
D) revenue assessment.

Question 19

Citizens and special interest groups often have interest in the information generated by government accounting.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is NOT an area of importance in accounting?

Accepted Answer

A) recording information about financial transactions. 
B) summarizing information about financial transactions. 
C) analyzing financial information. 
D) setting prices for goods and services sold by the organization. 
A) recording information about financial transactions. 
B) summarizing information about financial transactions. 
C) analyzing financial information. 
D) setting prices for goods and services sold by the organization.

The __________ is an accounting statement that reports the financial condition of a firm at a specific point in time.

A(n)_________ is a yearly statement of the financial condition,progress and expectations of an organization.

The accounting system happens once a year.

The balance sheet reflects the fact that assets equal the sum of liabilities and owners' equity.

Accountants do most of the work involved in recording financial events and transactions,but the actual classifying and interpreting of this data is left to financial managers.

Which of the following would be classified as a general expense on an income statement?

The three key financial statements of a business are the

If the goal of a business is to pay lower taxes on its income during an inflationary period,it is likely to use the FIFO inventory costing method.

Generally,a high ___________ ratio could lead investors and creditors to view the company as being very risky.

The value of things you own minus the amount of money you owe others is called equity.

As an accountant,Joe Billings would be most likely to be involved in:

A major part of a bookkeeper's job is to interpret financial data and suggest strategies for improving the firm.

Careful consideration of the use of computers in accounting indicates that computers:

One of the major financial statements prepared in the fifth step of the accounting cycle is the:

Salaries of salespeople and advertising costs are common examples of general expenses.

During a period of rising prices,if a firm desired to report a low net income figure in hopes of reducing their income tax liability,the firm would use the ________ inventory valuation method.

Perry is responsible for recording all sales transactions that take place at Turncoat Enterprises.He must be careful that his recording is both accurate and thorough.Perry's work involves tasks associated with:

Citizens and special interest groups often have interest in the information generated by government accounting.

Which of the following is NOT an area of importance in accounting?

Taking Risks and Making Profits Within the Dynamic Business Environment

How Economic Issues Affect Business

Competing in Global Markets

The Role of Government in Business

Ethics and Social Responsibility

Forms of Business Ownership

Entrepreneurship and Starting a Small Business

Management and Leadership

Adapting Organizations to Todays Markets

Producing World-Class Goods and Services

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Understanding Employeemanagement Issues and Relations

Marketing: Building Customer and Stakeholder Relationships

Managing the Marketing Mix: Product, Price, Place, and Promotion

Financial Management

The Financial Services Industry in Canada

Filters

Exam 16: Understanding Accounting and Financial Information

The __________ is an accounting statement that reports the financial condition of a firm at a specific point in time.

A(n)_________ is a yearly statement of the financial condition,progress and expectations of an organization.

The accounting system happens once a year.

The balance sheet reflects the fact that assets equal the sum of liabilities and owners' equity.

Accountants do most of the work involved in recording financial events and transactions,but the actual classifying and interpreting of this data is left to financial managers.

Which of the following would be classified as a general expense on an income statement?

The three key financial statements of a business are the

If the goal of a business is to pay lower taxes on its income during an inflationary period,it is likely to use the FIFO inventory costing method.

Generally,a high ___________ ratio could lead investors and creditors to view the company as being very risky.

The value of things you own minus the amount of money you owe others is called equity.

As an accountant,Joe Billings would be most likely to be involved in:

A major part of a bookkeeper's job is to interpret financial data and suggest strategies for improving the firm.

Careful consideration of the use of computers in accounting indicates that computers:

One of the major financial statements prepared in the fifth step of the accounting cycle is the:

Salaries of salespeople and advertising costs are common examples of general expenses.

During a period of rising prices,if a firm desired to report a low net income figure in hopes of reducing their income tax liability,the firm would use the ________ inventory valuation method.

Perry is responsible for recording all sales transactions that take place at Turncoat Enterprises.He must be careful that his recording is both accurate and thorough.Perry's work involves tasks associated with:

Citizens and special interest groups often have interest in the information generated by government accounting.

Which of the following is NOT an area of importance in accounting?

Taking Risks and Making Profits Within the Dynamic Business Environment

How Economic Issues Affect Business

Competing in Global Markets

The Role of Government in Business

Ethics and Social Responsibility

Forms of Business Ownership

Entrepreneurship and Starting a Small Business

Management and Leadership

Adapting Organizations to Todays Markets

Producing World-Class Goods and Services

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Understanding Employeemanagement Issues and Relations

Marketing: Building Customer and Stakeholder Relationships

Managing the Marketing Mix: Product, Price, Place, and Promotion

Financial Management

The Financial Services Industry in Canada

Filters