Exam 8: Accounting: Decision Making by the Numbers

Sally is an employee of EcoTrans Inc. Her duties include preparing reports and analyzing company accounting data. She also appraises financial performances, verifies the accuracy and validity of the company's internal records and accounting procedures. Sally's role is that of a _____.

Accounts receivable is categorized as a(n) _____.

Generally accepted accounting principles (GAAP) are adopted in managerial accounting to provide accounting information to managers of specific departments.

What is activity­based costing? Describe the two­stage process of activity­ based costing.

Iang aai bnsatl atnhcee a sshseetest ,o of w thnee rfsir' meq. uity indicates the claims a firm's owners have

Revenue is the difference between the net income a firm earns and the expenses it incurs in a given time period.

Activity­based costing involves two stages. The first stage is to identify specific activities that create indirect costs and determine the factors that drive the costs of these activities.

Which of the following represents assets on a balance sheet with a limited useful life that are subject to subtraction of accumulated depreciation from the original value?

Management, internal, and government accountants are business titles used by certified public accountants.

Copyrights and trademarks are tangible assets.

The preparation of operating budgets begins with the development of a sales budget.

An out­of­pocket cost is an implicit cost.

The ability to understand accounting information is not valuable to a person investing in a business.

On an income statement, which of the following measures the profit or loss of a firm?

Established by the Sarbanes­Oxley Act of 2002, it is the responsibility of the _____ to protect the interests of investors and further the public interest in the preparation of informative, fair, and independent audit reports.

Budgets that communicate an organization's sales and production goals and the resources needed to achieve these goals are known as _____.

The Taylix Company's balance sheet showed $18,000,000 in assets and $10,000,000 in liabilities. From the given information, the firm's owners' equity equals $6,000,000.

Describe out­of­pocket and implicit costs.

Generally accepted accounting principles (GAAP) are a set of accounting standards used in the preparation of financial statements.

Which of the following indicates what a firm owes its creditors?