Question 1

Notes to the financial statements include all of the following except

Accepted Answer

A) descriptions of significant accounting policies used. 
B) explanations of uncertainties. 
C) projected accounting information. 
D) statistics needed to understand the statements. 
A) descriptions of significant accounting policies used. 
B) explanations of uncertainties. 
C) projected accounting information. 
D) statistics needed to understand the statements.

Question 2

The group of users of accounting information charged with achieving the goals of the business is its

Accepted Answer

A) auditors. 
B) investors. 
C) managers. 
D) creditors. 
A) auditors. 
B) investors. 
C) managers. 
D) creditors.

Question 3

Management of a business enterprise is the major external user of information.

Accepted Answer

A) True 
 B)False

Question 4

Dividends paid

Accepted Answer

A) increase assets. 
B) increase expenses. 
C) decrease revenues. 
D) decrease retained earnings. 
A) increase assets. 
B) increase expenses. 
C) decrease revenues. 
D) decrease retained earnings.

Question 5

An income statement

Accepted Answer

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

Question 6

Marvin Services Corporation had the following accounts and balances: $$\begin{array} { l r l r } 
\text { Accounts payable } & \$ 30,000 & \text { Equipment } & \$ 35,000 \
\text { Accounts receivable } & 5,000 & \text { Land } & 35,000 \
\text { Buil dings } & ? & \text { Unearned service revenue } & 10,000 \
\text { Cash } & 15,000 & \text { Total stockholders' equity } & ?
\end{array}$$ If the balance of the Buildings account was $85000 what would be the total of liabilities and stockholders' equity?

Accepted Answer

A) $170000 
B) $175000 
C) $135000 
D) $125000 
A) $170000 
B) $175000 
C) $135000 
D) $125000

Question 7

If total liabilities decreased by $105000 and stockholders' equity decreased by $35000 during a period of time then total assets must change by what amount and direction during that same period?

Accepted Answer

A) $140000 increase 
B) $70000 decrease 
C) $140000 decrease. 
D) $70000 decrease. 
A) $140000 increase 
B) $70000 decrease 
C) $140000 decrease. 
D) $70000 decrease.

Question 8

Investing activities involve collecting the necessary funds to support the business.

Accepted Answer

A) True 
 B)False

Question 9

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

Accepted Answer

A) net income is less than dividends. 
B) there was a net income and no dividends. 
C) additional investments are less than net losses. 
D) net income is greater than dividends. 
A) net income is less than dividends. 
B) there was a net income and no dividends. 
C) additional investments are less than net losses. 
D) net income is greater than dividends.

Question 10

The Internal Revenue Service is an external user of accounting information and a

Accepted Answer

A) taxing authority. 
B) labor union. 
C) customer. 
D) regulatory agency. 
A) taxing authority. 
B) labor union. 
C) customer. 
D) regulatory agency.

Question 11

Information in the notes to the financial statements has to be quantifiable (numeric).

Accepted Answer

A) True 
 B)False

Question 12

The balance sheet reports assets and claims to those assets at a specific point in time.

Accepted Answer

A) True 
 B)False

Question 13

The management discussion and analysis (MD&A) section of the annual report covers all of the following aspects except the

Accepted Answer

A) ability of the company to pay near-term obligations. 
B) certification criteria of the company's auditors. 
C) company's ability to fund operations and expansion. 
D) results of the company operations. 
A) ability of the company to pay near-term obligations. 
B) certification criteria of the company's auditors. 
C) company's ability to fund operations and expansion. 
D) results of the company operations.

Question 14

Barrow Company recorded the following cash transactions for the year: Paid $115000 for salaries.
Paid $40000 to purchase office equipment.
Paid $9000 for utilities.
Sold investments for cash of $5000.
Paid $11000 in dividends.
Collected $295000 from customers.
Issued shares for cash of $120000.
What was Barrow's net cash provided (used) by financing activities?

Accepted Answer

A) $60000 
B) $65000 
C) $69000 
D) $109000 
A) $60000 
B) $65000 
C) $69000 
D) $109000

Question 15

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

Accepted Answer

A) balance sheet. 
B) income statement. 
C) statement of cash flows. 
D) retained earnings statement. 
A) balance sheet. 
B) income statement. 
C) statement of cash flows. 
D) retained earnings statement.

Question 16

Retained earnings at the end of the period is equal to

Accepted Answer

A) retained earnings at the beginning of the period plus net income minus liabilities. 
B) retained earnings at the beginning of the period plus net income minus dividends. 
C) net income. 
D) assets plus liabilities. 
A) retained earnings at the beginning of the period plus net income minus liabilities. 
B) retained earnings at the beginning of the period plus net income minus dividends. 
C) net income. 
D) assets plus liabilities.

Question 17

Which of the following statements is true?

Accepted Answer

A) Amounts received from issuing stock are revenues. 
B) Amounts paid out as dividends are not expenses. 
C) Amounts paid out as dividends are reported on the income statement. 
D) Amounts received from issued stock are reported on the income statement. 
A) Amounts received from issuing stock are revenues. 
B) Amounts paid out as dividends are not expenses. 
C) Amounts paid out as dividends are reported on the income statement. 
D) Amounts received from issued stock are reported on the income statement.

Question 18

Which of the following are internal reports that accounting provides to internal users?

Accepted Answer

A) Forecasts of cash needs for next year but not financial comparisons of operating activity alternatives. 
B) Financial comparisons of operating activity alternatives but not forecasts of cash needs for next year. 
C) Both forecasts of cash needs and financial comparisons are internal reports. 
D) Neither forecasts of cash needs nor financial comparisons are internal reports. 
A) Forecasts of cash needs for next year but not financial comparisons of operating activity alternatives. 
B) Financial comparisons of operating activity alternatives but not forecasts of cash needs for next year. 
C) Both forecasts of cash needs and financial comparisons are internal reports. 
D) Neither forecasts of cash needs nor financial comparisons are internal reports.

Question 19

Which of the following financial statements is divided into major categories of operating investing and financing activities?

Accepted Answer

A) The income statement. 
B) The balance sheet. 
C) The retained earnings statement. 
D) The statement of cash flows. 
A) The income statement. 
B) The balance sheet. 
C) The retained earnings statement. 
D) The statement of cash flows.

Question 20

A balance sheet shows

Accepted Answer

A) revenues liabilities and stockholders' equity. 
B) expenses dividends and stockholders' equity. 
C) revenues expenses and dividends. 
D) assets liabilities and stockholders' equity. 
A) revenues liabilities and stockholders' equity. 
B) expenses dividends and stockholders' equity. 
C) revenues expenses and dividends. 
D) assets liabilities and stockholders' equity.

Notes to the financial statements include all of the following except

The group of users of accounting information charged with achieving the goals of the business is its

Management of a business enterprise is the major external user of information.

Dividends paid

An income statement

If total liabilities decreased by $105000 and stockholders' equity decreased by $35000 during a period of time then total assets must change by what amount and direction during that same period?

Investing activities involve collecting the necessary funds to support the business.

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

The Internal Revenue Service is an external user of accounting information and a

Information in the notes to the financial statements has to be quantifiable (numeric).

The balance sheet reports assets and claims to those assets at a specific point in time.

The management discussion and analysis (MD&A) section of the annual report covers all of the following aspects except the

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

Retained earnings at the end of the period is equal to

Which of the following statements is true?

Which of the following are internal reports that accounting provides to internal users?

Which of the following financial statements is divided into major categories of operating investing and financing activities?

A balance sheet shows

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters

Exam 1: Introduction to Financial Statements

Notes to the financial statements include all of the following except

The group of users of accounting information charged with achieving the goals of the business is its

Management of a business enterprise is the major external user of information.

Dividends paid

An income statement

If total liabilities decreased by $105000 and stockholders' equity decreased by $35000 during a period of time then total assets must change by what amount and direction during that same period?

Investing activities involve collecting the necessary funds to support the business.

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

The Internal Revenue Service is an external user of accounting information and a

Information in the notes to the financial statements has to be quantifiable (numeric).

The balance sheet reports assets and claims to those assets at a specific point in time.

The management discussion and analysis (MD&A) section of the annual report covers all of the following aspects except the

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

Retained earnings at the end of the period is equal to

Which of the following statements is true?

Which of the following are internal reports that accounting provides to internal users?

Which of the following financial statements is divided into major categories of operating investing and financing activities?

A balance sheet shows

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters