Question 1

A statement of financial position shows

Accepted Answer

A)  revenues, liabilities, and shareholders' equity. 
B)  expenses, dividends declared, and shareholders' equity. 
C)  revenues, expenses, and dividends declared. 
D)  assets, liabilities, and shareholders' equity. 
A)  revenues, liabilities, and shareholders' equity. 
B)  expenses, dividends declared, and shareholders' equity. 
C)  revenues, expenses, and dividends declared. 
D)  assets, liabilities, and shareholders' equity.

Question 2

The financial statement that summarizes the changes in common shares and retained earnings for a specific period of time is the

Accepted Answer

A)  statement of financial position. 
B)  income statement. 
C)  statement of cash flows. 
D)  statement of changes in equity. 
A)  statement of financial position. 
B)  income statement. 
C)  statement of cash flows. 
D)  statement of changes in equity.

Question 3

The world's economic systems depend on financial reporting that is

Accepted Answer

A)  highly transparent. 
B)  accurate. 
C)  reliable. 
D)  all of the above 
A)  highly transparent. 
B)  accurate. 
C)  reliable. 
D)  all of the above

Question 4

Anyone who works for a company but does not necessarily have access to accounting information to assist them in managing and operating the company is still considered to be an internal user.

Accepted Answer

A) True 
 B)False

Question 5

Companies present summarized financial information in the form of financial statements for both internal and external use.

Accepted Answer

A) True 
 B)False

Question 6

Resources owned by a corporation are referred to as

Accepted Answer

A)  shareholders' equity. 
B)  liabilities. 
C)  assets. 
D)  revenues. 
A)  shareholders' equity. 
B)  liabilities. 
C)  assets. 
D)  revenues.

Question 7

The statement of cash flows shows how cash was used during the period.

Accepted Answer

A) True 
 B)False

Question 8

Accounting identifies and records economic events of a business.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following uses accounting information to determine whether a marketing proposal will be cost effective?

Accepted Answer

A)  shareholders 
B)  marketing managers 
C)  creditors 
D)  Human Resource managers 
A)  shareholders 
B)  marketing managers 
C)  creditors 
D)  Human Resource managers

Question 10

Which of the following groups uses accounting information primarily to ensure the company is operating within prescribed rules?

Accepted Answer

A)  taxing authorities 
B)  regulatory agencies 
C)  labour unions 
D)  management 
A)  taxing authorities 
B)  regulatory agencies 
C)  labour unions 
D)  management

Question 11

Expenses are identified by the type of liability associated with them.

Accepted Answer

A) True 
 B)False

Question 12

Claims of creditors and shareholders on the assets of a business are called liabilities.

Accepted Answer

A) True 
 B)False

Question 13

If the retained earnings account increases from the beginning of the year to the end of the year, then

Accepted Answer

A)  net income is greater than dividends declared. 
B)  a loss is less than dividends declared. 
C)  additional investments are less than reported losses. 
D)  dividends were received. 
A)  net income is greater than dividends declared. 
B)  a loss is less than dividends declared. 
C)  additional investments are less than reported losses. 
D)  dividends were received.

Question 14

A business organized as a corporation

Accepted Answer

A)  is not a separate legal entity in most provinces. 
B)  requires that shareholders be personally liable for the debts of the business. 
C)  is owned by its shareholders. 
D)  has income tax disadvantages over a proprietorship or partnership. 
A)  is not a separate legal entity in most provinces. 
B)  requires that shareholders be personally liable for the debts of the business. 
C)  is owned by its shareholders. 
D)  has income tax disadvantages over a proprietorship or partnership.

Question 15

The statement of financial position

Accepted Answer

A)  summarizes the changes in shareholders' equity for a specific period of time. 
B)  reports the changes in assets, liabilities, and shareholders' equity over a period of time. 
C)  reports the assets, liabilities, and shareholders' equity at a specific date. 
D)  presents the revenues and expenses for a specific period of time. 
A)  summarizes the changes in shareholders' equity for a specific period of time. 
B)  reports the changes in assets, liabilities, and shareholders' equity over a period of time. 
C)  reports the assets, liabilities, and shareholders' equity at a specific date. 
D)  presents the revenues and expenses for a specific period of time.

Question 16

Which of the following would not be considered an external user of accounting data?

Accepted Answer

A)  Canada Revenue Agency 
B)  management 
C)  creditors 
D)  customers 
A)  Canada Revenue Agency 
B)  management 
C)  creditors 
D)  customers

Question 17

Which of the following is not a principal type of business activity?

Accepted Answer

A)  operating 
B)  investing 
C)  financing 
D)  marketing 
A)  operating 
B)  investing 
C)  financing 
D)  marketing

Question 18

Assets are resources owned by a business that provide current services or benefits to the business.

Accepted Answer

A) True 
 B)False

Question 19

A proprietorship is usually operated by the owner.

Accepted Answer

A) True 
 B)False

Question 20

Common shares represent

Accepted Answer

A)  the creditors' claims on the company. 
B)  the total net income of the company to date. 
C)  the amount paid by investors for ownership in the company. 
D)  the owners' claims on the company. 
A)  the creditors' claims on the company. 
B)  the total net income of the company to date. 
C)  the amount paid by investors for ownership in the company. 
D)  the owners' claims on the company.

A statement of financial position shows

The financial statement that summarizes the changes in common shares and retained earnings for a specific period of time is the

The world's economic systems depend on financial reporting that is

Anyone who works for a company but does not necessarily have access to accounting information to assist them in managing and operating the company is still considered to be an internal user.

Companies present summarized financial information in the form of financial statements for both internal and external use.

Resources owned by a corporation are referred to as

The statement of cash flows shows how cash was used during the period.

Accounting identifies and records economic events of a business.

Which of the following uses accounting information to determine whether a marketing proposal will be cost effective?

Which of the following groups uses accounting information primarily to ensure the company is operating within prescribed rules?

Expenses are identified by the type of liability associated with them.

Claims of creditors and shareholders on the assets of a business are called liabilities.

If the retained earnings account increases from the beginning of the year to the end of the year, then

A business organized as a corporation

The statement of financial position

Which of the following would not be considered an external user of accounting data?

Which of the following is not a principal type of business activity?

Assets are resources owned by a business that provide current services or benefits to the business.

A proprietorship is usually operated by the owner.

Common shares represent

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Statement of Cash Flows

Performance Measurement

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Exam 1: The Purpose and Use of Financial Statements

A statement of financial position shows

The financial statement that summarizes the changes in common shares and retained earnings for a specific period of time is the

The world's economic systems depend on financial reporting that is

Anyone who works for a company but does not necessarily have access to accounting information to assist them in managing and operating the company is still considered to be an internal user.

Companies present summarized financial information in the form of financial statements for both internal and external use.

Resources owned by a corporation are referred to as

The statement of cash flows shows how cash was used during the period.

Accounting identifies and records economic events of a business.

Which of the following uses accounting information to determine whether a marketing proposal will be cost effective?

Which of the following groups uses accounting information primarily to ensure the company is operating within prescribed rules?

Expenses are identified by the type of liability associated with them.

Claims of creditors and shareholders on the assets of a business are called liabilities.

If the retained earnings account increases from the beginning of the year to the end of the year, then

A business organized as a corporation

The statement of financial position

Which of the following would not be considered an external user of accounting data?

Which of the following is not a principal type of business activity?

Assets are resources owned by a business that provide current services or benefits to the business.

A proprietorship is usually operated by the owner.

Common shares represent

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Statement of Cash Flows

Performance Measurement

Filters