Question 1

The purpose of the current ratio is to evaluate the firm's ability to:

Accepted Answer

A) generate sales with a given level of current assets. 
B) utilize current assets profitably. 
C) pay its bills in the short run. 
D) effectively use borrowed funds. 
A) generate sales with a given level of current assets. 
B) utilize current assets profitably. 
C) pay its bills in the short run. 
D) effectively use borrowed funds.

Question 2

Financial accountants prepare reports for owners,creditors,suppliers,and others outside of the organization.

Accepted Answer

A) True 
 B)False

Question 3

The accounting profession is divided into five key working areas,two of which are:

Accepted Answer

A) auditing and managerial accounting. 
B) forecasting and logistical accounting. 
C) inventory control and budgeting. 
D) income accounting and expenditure accounting. 
A) auditing and managerial accounting. 
B) forecasting and logistical accounting. 
C) inventory control and budgeting. 
D) income accounting and expenditure accounting.

Question 4

Activity ratios measure the effectiveness of the firm's management in using its various resources to achieve profits.

Accepted Answer

A) True 
 B)False

Question 5

A firm's ________ reports the profit or loss for the firm over a specified time period.

Accepted Answer

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

Question 6

Computerized accounting programs have eliminated the need to prepare a trial balance.

Accepted Answer

A) True 
 B)False

Question 7

Horst works as an accountant for a mid-sized retail store.He has just completed a trial balance that turned up no unexpected problems.Horst's next major task is likely to be:

Accepted Answer

A) conducting the full audit. 
B) preparing a tax return for the company. 
C) preparing the store's balance sheet and other major financial statements. 
D) taking a well-deserved vacation,since he has just finished the last step in the accounting cycle for the current period. 
A) conducting the full audit. 
B) preparing a tax return for the company. 
C) preparing the store's balance sheet and other major financial statements. 
D) taking a well-deserved vacation,since he has just finished the last step in the accounting cycle for the current period.

Question 8

Financial accounting involves activities such as preparing budgets and measuring production costs.

Accepted Answer

A) True 
 B)False

Question 9

A firm's annual report is a yearly statement of the financial condition,progress,and expectations of the organization during one year.

Accepted Answer

A) True 
 B)False

Question 10

__________ earnings per share measures the amount of profit a firm earns per share of outstanding common stock when preferred stock,stock options,warrants and convertible debt securities are also taken into account.

Accepted Answer

A) Basic 
B) Diluted 
C) Restricted 
D) Broad-based 
A) Basic 
B) Diluted 
C) Restricted 
D) Broad-based

Question 11

One of the problems with current accounting procedures is that there is no way for firms to systematically write off the costs of property and equipment over time.

Accepted Answer

A) True 
 B)False

Question 12

_________ involves the recording of business transactions.

Accepted Answer

A) Marketing 
B) Bookkeeping 
C) Auditing 
D) Economics 
A) Marketing 
B) Bookkeeping 
C) Auditing 
D) Economics

Question 13

Liquidity ratios are of particular importance to stockholders,but have little relevance for creditors.

Accepted Answer

A) True 
 B)False

Question 14

The job of reviewing and evaluating the records used to prepare a company's financial statements is referred to as compliance.

Accepted Answer

A) True 
 B)False

Question 15

What group or groups are interested in a company's financial statements?

Accepted Answer

Owners,creditors,sup

Question 16

For firms that sometimes have difficulty selling their inventory of goods,the current ratio is likely to be a better measure of liquidity than the acid-test ratio.

Accepted Answer

A) True 
 B)False

Question 17

If a firm can reduce its cost of goods sold and continue to sell its product for the same price,we would expect the firm to enjoy an increase in its ________.

Accepted Answer

A) revenue 
B) liabilities 
C) employee turnover 
D) gross margin 
A) revenue 
B) liabilities 
C) employee turnover 
D) gross margin

Question 18

Financial accounting and managerial accounting are similar in that they both provide information intended primarily for people inside the organization.

Accepted Answer

A) True 
 B)False

Question 19

The __________ is a six step procedure that results in the preparation and analysis of the major financial statements.

Accepted Answer

A) double-entry method 
B) financial management process 
C) financial performance appraisal 
D) accounting cycle 
A) double-entry method 
B) financial management process 
C) financial performance appraisal 
D) accounting cycle

Question 20

Jamal is an accountant employed by Acctex,Inc.Jamal is an example of a public accountant.

Accepted Answer

A) True 
 B)False

The purpose of the current ratio is to evaluate the firm's ability to:

Financial accountants prepare reports for owners,creditors,suppliers,and others outside of the organization.

The accounting profession is divided into five key working areas,two of which are:

Activity ratios measure the effectiveness of the firm's management in using its various resources to achieve profits.

A firm's ________ reports the profit or loss for the firm over a specified time period.

Computerized accounting programs have eliminated the need to prepare a trial balance.

Horst works as an accountant for a mid-sized retail store.He has just completed a trial balance that turned up no unexpected problems.Horst's next major task is likely to be:

Financial accounting involves activities such as preparing budgets and measuring production costs.

A firm's annual report is a yearly statement of the financial condition,progress,and expectations of the organization during one year.

__________ earnings per share measures the amount of profit a firm earns per share of outstanding common stock when preferred stock,stock options,warrants and convertible debt securities are also taken into account.

One of the problems with current accounting procedures is that there is no way for firms to systematically write off the costs of property and equipment over time.

_________ involves the recording of business transactions.

Liquidity ratios are of particular importance to stockholders,but have little relevance for creditors.

The job of reviewing and evaluating the records used to prepare a company's financial statements is referred to as compliance.

What group or groups are interested in a company's financial statements?

For firms that sometimes have difficulty selling their inventory of goods,the current ratio is likely to be a better measure of liquidity than the acid-test ratio.

If a firm can reduce its cost of goods sold and continue to sell its product for the same price,we would expect the firm to enjoy an increase in its ________.

Financial accounting and managerial accounting are similar in that they both provide information intended primarily for people inside the organization.

The __________ is a six step procedure that results in the preparation and analysis of the major financial statements.

Jamal is an accountant employed by Acctex,Inc.Jamal is an example of a public accountant.

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

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Exam 16: Understanding Accounting and Financial Information

The purpose of the current ratio is to evaluate the firm's ability to:

Financial accountants prepare reports for owners,creditors,suppliers,and others outside of the organization.

The accounting profession is divided into five key working areas,two of which are:

Activity ratios measure the effectiveness of the firm's management in using its various resources to achieve profits.

A firm's ________ reports the profit or loss for the firm over a specified time period.

Computerized accounting programs have eliminated the need to prepare a trial balance.

Horst works as an accountant for a mid-sized retail store.He has just completed a trial balance that turned up no unexpected problems.Horst's next major task is likely to be:

Financial accounting involves activities such as preparing budgets and measuring production costs.

A firm's annual report is a yearly statement of the financial condition,progress,and expectations of the organization during one year.

__________ earnings per share measures the amount of profit a firm earns per share of outstanding common stock when preferred stock,stock options,warrants and convertible debt securities are also taken into account.

One of the problems with current accounting procedures is that there is no way for firms to systematically write off the costs of property and equipment over time.

_________ involves the recording of business transactions.

Liquidity ratios are of particular importance to stockholders,but have little relevance for creditors.

The job of reviewing and evaluating the records used to prepare a company's financial statements is referred to as compliance.

What group or groups are interested in a company's financial statements?

For firms that sometimes have difficulty selling their inventory of goods,the current ratio is likely to be a better measure of liquidity than the acid-test ratio.

If a firm can reduce its cost of goods sold and continue to sell its product for the same price,we would expect the firm to enjoy an increase in its ________.

Financial accounting and managerial accounting are similar in that they both provide information intended primarily for people inside the organization.

The __________ is a six step procedure that results in the preparation and analysis of the major financial statements.

Jamal is an accountant employed by Acctex,Inc.Jamal is an example of a public accountant.

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

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