Question 1

The accounts receivable turnover estimates the number of times a firm sells and replaces its inventory each year.

Accepted Answer

A) True 
 B)False  False

Question 2

If total liabilities were subtracted from total assets, the residual value would be _____.

Accepted Answer

A)  revenues 
B)  owners' equity 
C)  net income 
D)  working capital 
E)  expenses 
A)  revenues 
B)  owners' equity 
C)  net income 
D)  working capital 
E)  expenses B

Question 3

The three primary financial reports are the income statement, the balance sheet, and the statement of cash flows.

Accepted Answer

A) True 
 B)False  True

Question 4

The return on sales ratio indicates how effectively a firm is transforming its sales into profits.

Accepted Answer

A) True 
 B)False

Question 5

Most of a firm's proprietary accounting information is reported to the general public in the firm's annual report.

Accepted Answer

A) True 
 B)False

Question 6

People who purchased stock in Morgan Oil Exploration are most interested in its ____ reports.

Accepted Answer

A)  managerial accounting 
B)  schedule of assets 
C)  tax accounting 
D)  financial accounting 
E)  cost accounting 
A)  managerial accounting 
B)  schedule of assets 
C)  tax accounting 
D)  financial accounting 
E)  cost accounting

Question 7

A firm has $260,000 in assets and $158,000 in stockholders' equity.It owes $55,000 from a long-term loan, and this is its only long-term liability.This firm has ____ in total current liabilities.

Accepted Answer

A)  $55,000 
B)  $103,000 
C)  $47,000 
D)  $102,000 
E)  $213,000 
A)  $55,000 
B)  $103,000 
C)  $47,000 
D)  $102,000 
E)  $213,000

Question 8

What does it mean to post a transaction? Would this part of the accounting cycle be done before or after preparing a trial balance?

Accepted Answer

Posting a transaction refers to the proc

Question 9

The process of apportioning the cost of a fixed asset over the period during which it will be used is known as depreciation.

Accepted Answer

A) True 
 B)False

Question 10

Lutex Corporation began its accounting period with a merchandise inventory (beginning inventory) that cost $10,000.During the period, it purchased for resale merchandise with a retail value of $100,000.With purchase discounts, it paid only $80,000 for this merchandise.Thus, during this period, Lutex had ____ in goods available for sale.

Accepted Answer

A)  $180,000 
B)  $70,000 
C)  $80,000 
D)  $90,000 
E)  $190,000 
A)  $180,000 
B)  $70,000 
C)  $80,000 
D)  $90,000 
E)  $190,000

Question 11

Which of the following presents assets in the correct balance sheet order?

Accepted Answer

A)  cash, land, accounts receivable, equipment 
B)  marketable securities, equipment, prepaid insurance, inventory 
C)  cash, inventory, equipment 
D)  accounts receivable, buildings, inventory, land 
E)  buildings, prepaid expenses, inventory, equipment 
A)  cash, land, accounts receivable, equipment 
B)  marketable securities, equipment, prepaid insurance, inventory 
C)  cash, inventory, equipment 
D)  accounts receivable, buildings, inventory, land 
E)  buildings, prepaid expenses, inventory, equipment

Question 12

According to the accounting equation, cash, inventory, equipment, and real estate are classified as owners' equity.

Accepted Answer

A) True 
 B)False

Question 13

Since furniture and store equipment for Rosalind's Boutique will be held or used for a period longer than one year, they are considered _____.

Accepted Answer

A)  fixed assets 
B)  owners' equity 
C)  revenue 
D)  current assets 
E)  prepaid expenses 
A)  fixed assets 
B)  owners' equity 
C)  revenue 
D)  current assets 
E)  prepaid expenses

Question 14

Ridgley, Cooper, and Ross (RCR)
Katie is the CEO of Ridgley, Cooper, and Ross (RCR), a regional accounting firm.RCR offers services in most areas of accounting, including auditing and consulting services.The firm must follow the GAAP rules, just like any other accounting firm.If there are information gaps that are not addressed and resolved by the firm, RCR could be considered a violator of the Sarbanes-Oxley Act.Katie understands what must be done and wants every employee of the firm to understand that they have to follow all the rules and regulations.Like any other industry, accounting is a competitive industry and employees of accounting firms must be productive, progressive, and well trained.
-Refer to Ridgley, Cooper, and Ross.One of RCR's clients is ABC Electronics.RCR develops ABC Electronics' statements and reports for ABC's stockholders, financial analysts, and bankers.These services can be classified as which of the following?

Accepted Answer

A)  non-accounting services 
B)  tax accounting 
C)  financial accounting 
D)  managerial accounting 
E)  cost accounting 
A)  non-accounting services 
B)  tax accounting 
C)  financial accounting 
D)  managerial accounting 
E)  cost accounting

Question 15

Today corporations are required to send their stockholders an annual report.Assume that you are a prospective investor trying to decide if you should invest in a specific corporation.What type of information is contained in an annual report that would help you decide if this is the right investment for you?

Accepted Answer

An annual report typically contains a va

Question 16

A private accountant is an accountant whose services may be hired on a fee basis by individuals or business firms.

Accepted Answer

A) True 
 B)False

Question 17

Mirror Emporium's sole owner, Fred Martin, is happy about his $100,000 profit.However, while he knows that the firm is profitable, he wants to know how effectively his investment is being used.What computation would you recommend?

Accepted Answer

A)  return on sales 
B)  earnings per share 
C)  return on owners' equity 
D)  current ratio 
E)  activity ratios 
A)  return on sales 
B)  earnings per share 
C)  return on owners' equity 
D)  current ratio 
E)  activity ratios

Question 18

Debts that need not be repaid for at least one year are referred to as _____.

Accepted Answer

A)  expenses 
B)  current assets 
C)  long-term liabilities 
D)  fixed assets 
E)  current liabilities 
A)  expenses 
B)  current assets 
C)  long-term liabilities 
D)  fixed assets 
E)  current liabilities

Question 19

During the year Comer, Inc., had $200,000 in goods available for sale.At the end of the accounting period it had an ending inventory of $40,000.This reveals that it had sold all but ____ worth of the available goods.

Accepted Answer

A)  $200,000 
B)  $160,000 
C)  $40,000 
D)  $20,000 
E)  $10,000 
A)  $200,000 
B)  $160,000 
C)  $40,000 
D)  $20,000 
E)  $10,000

Question 20

A public accountant works on a fee basis for clients.

Accepted Answer

A) True 
 B)False

The accounts receivable turnover estimates the number of times a firm sells and replaces its inventory each year.

If total liabilities were subtracted from total assets, the residual value would be _____.

The three primary financial reports are the income statement, the balance sheet, and the statement of cash flows.

The return on sales ratio indicates how effectively a firm is transforming its sales into profits.

Most of a firm's proprietary accounting information is reported to the general public in the firm's annual report.

People who purchased stock in Morgan Oil Exploration are most interested in its ____ reports.

A firm has $260,000 in assets and $158,000 in stockholders' equity.It owes $55,000 from a long-term loan, and this is its only long-term liability.This firm has ____ in total current liabilities.

What does it mean to post a transaction? Would this part of the accounting cycle be done before or after preparing a trial balance?

The process of apportioning the cost of a fixed asset over the period during which it will be used is known as depreciation.

Which of the following presents assets in the correct balance sheet order?

According to the accounting equation, cash, inventory, equipment, and real estate are classified as owners' equity.

Since furniture and store equipment for Rosalind's Boutique will be held or used for a period longer than one year, they are considered _____.

A private accountant is an accountant whose services may be hired on a fee basis by individuals or business firms.

Mirror Emporium's sole owner, Fred Martin, is happy about his $100,000 profit.However, while he knows that the firm is profitable, he wants to know how effectively his investment is being used.What computation would you recommend?

Debts that need not be repaid for at least one year are referred to as _____.

During the year Comer, Inc., had $200,000 in goods available for sale.At the end of the accounting period it had an ending inventory of $40,000.This reveals that it had sold all but ____ worth of the available goods.

A public accountant works on a fee basis for clients.

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

Exploring Global Business

Choosing a Form of Business Ownership

Small Business, Entrepreneurship, and Franchises

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Information and E-Business

Mastering Financial Management

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Exam 15: Using Accounting Information

The accounts receivable turnover estimates the number of times a firm sells and replaces its inventory each year.

If total liabilities were subtracted from total assets, the residual value would be _____.

The three primary financial reports are the income statement, the balance sheet, and the statement of cash flows.

The return on sales ratio indicates how effectively a firm is transforming its sales into profits.

Most of a firm's proprietary accounting information is reported to the general public in the firm's annual report.

People who purchased stock in Morgan Oil Exploration are most interested in its ____ reports.

A firm has $260,000 in assets and $158,000 in stockholders' equity.It owes $55,000 from a long-term loan, and this is its only long-term liability.This firm has ____ in total current liabilities.

What does it mean to post a transaction? Would this part of the accounting cycle be done before or after preparing a trial balance?

The process of apportioning the cost of a fixed asset over the period during which it will be used is known as depreciation.

Which of the following presents assets in the correct balance sheet order?

According to the accounting equation, cash, inventory, equipment, and real estate are classified as owners' equity.

Since furniture and store equipment for Rosalind's Boutique will be held or used for a period longer than one year, they are considered _____.

A private accountant is an accountant whose services may be hired on a fee basis by individuals or business firms.

Mirror Emporium's sole owner, Fred Martin, is happy about his $100,000 profit.However, while he knows that the firm is profitable, he wants to know how effectively his investment is being used.What computation would you recommend?

Debts that need not be repaid for at least one year are referred to as _____.

During the year Comer, Inc., had $200,000 in goods available for sale.At the end of the accounting period it had an ending inventory of $40,000.This reveals that it had sold all but ____ worth of the available goods.

A public accountant works on a fee basis for clients.

Exploring the World of Business and Economics

Being Ethical and Socially Responsible

Exploring Global Business

Choosing a Form of Business Ownership

Small Business, Entrepreneurship, and Franchises

Understanding the Management Process

Creating a Flexible Organization

Producing Quality Goods and Services

Attracting and Retaining the Best Employees

Motivating and Satisfying Employees and Teams

Building Customer Relationships Through Effective Marketing

Creating and Pricing Products That Satisfy Customers

Distributing and Promoting Products

Understanding Information and E-Business

Mastering Financial Management

Filters