Question 1

________ measures the speed of inventory moving through the firm and its conversion into sales.

Accepted Answer

A)  Asset turnover ratio 
B)  Inventory turnover ratio 
C)  Sales turnover ratio 
D)  Cost of goods sold turnover ratio 
A)  Asset turnover ratio 
B)  Inventory turnover ratio 
C)  Sales turnover ratio 
D)  Cost of goods sold turnover ratio

Question 2

An accountant who works for a single business or government agency is referred to as a:

Accepted Answer

A)  Public accountant. 
B)  Private accountant. 
C)  Certified accountant. 
D)  Commission accountant. 
A)  Public accountant. 
B)  Private accountant. 
C)  Certified accountant. 
D)  Commission accountant.

Question 3

If the economy began experiencing a prolonged period of deflation in which the prices of most goods are falling,many firms would find that the LIFO method of inventory valuation would result in higher reported profits.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

In an effort to maintain a competitive advantage,firms do not share accounting information with people outside of the firm.

Accepted Answer

A) True 
 B)False

Question 6

A statement of cash flows summarizes a company's cash receipts and cash payments over a period of time.

Accepted Answer

A) True 
 B)False

Question 7

Preferred Pet Care,Inc.successfully took out a loan for $130,000 from Southwest Bank.It used $80,000 of this loan to pay-off an existing loan that had a higher interest rate,and purchased X-ray equipment with the remaining funds.These events were noted as financing and investing activities on its balance sheet.

Accepted Answer

A) True 
 B)False

Question 8

Depreciation is a systematic write-off of the cost of a tangible asset that is listed on __________.

Accepted Answer

A)  The Statement of Cash Flows 
B)  The Balance Sheet 
C)  The Income Statement 
D)  The Statement of Retained Earnings 
A)  The Statement of Cash Flows 
B)  The Balance Sheet 
C)  The Income Statement 
D)  The Statement of Retained Earnings

Question 9

The balance sheet reports revenues and selling costs for a period of time.

Accepted Answer

A) True 
 B)False

Question 10

Patents and copyrights are examples of intangible assets.

Accepted Answer

A) True 
 B)False

Question 11

In order to calculate the current ratio for your firm,you divide the total value of current assets by:

Accepted Answer

A)  Earnings per share. 
B)  The total value of current liabilities. 
C)  The total owners' equity. 
D)  The total cost of goods solD. 
A)  Earnings per share. 
B)  The total value of current liabilities. 
C)  The total owners' equity. 
D)  The total cost of goods solD.

Question 12

During a period of rising prices,if a firm desires to report a low gross profit figure in hopes of reducing their income tax liability,the firm will use the __________ inventory valuation method.

Accepted Answer

A)  FIFO (first in,first out) 
B)  LIFO (last in,first out) 
C)  sliding scale 
D)  average cost 
A)  FIFO (first in,first out) 
B)  LIFO (last in,first out) 
C)  sliding scale 
D)  average cost

Question 13

Jose just graduated from college with a bachelor's degree in accounting.He plans to go to work for the American Cancer Society as an accountant.Jose will be a(n):

Accepted Answer

A)  private accountant. 
B)  public accountant. 
C)  forensic accountant. 
D)  independent accountant. 
A)  private accountant. 
B)  public accountant. 
C)  forensic accountant. 
D)  independent accountant.

Question 14

Accounting software has proven to be especially helpful for small business owners.

Accepted Answer

A) True 
 B)False

Question 15

FIFO and LIFO are two common:

Accepted Answer

A)  depreciation strategies. 
B)  ways to structure a balance sheet. 
C)  inventory valuation methods. 
D)  current ratios. 
A)  depreciation strategies. 
B)  ways to structure a balance sheet. 
C)  inventory valuation methods. 
D)  current ratios.

Question 16

Heather works in the accounting department of Colorado Manufacturing.Today she will use the firm's ledger to summarize information that was posted over the most recent time period.Her goal is to determine if the accounts are balanced as required by the double-entry method of bookkeeping.To be sure they are correct,Heather will prepare a(n):

Accepted Answer

A)  Account analysis. 
B)  Statement of cash flows. 
C)  Balance sheet. 
D)  Trial balance. 
A)  Account analysis. 
B)  Statement of cash flows. 
C)  Balance sheet. 
D)  Trial balance.

Question 17

The Balance Sheet for Renuvation LLC shows assets totaling $107,000 and liabilities totaling $75,000.Which of the following statements is correct?

Accepted Answer

A)  Owner's Equity equals $182,000. 
B)  Current Assets are worth $32,000. 
C)  Net Income for the period is $32,000. 
D)  Owner's Equity equals $32,000. 
A)  Owner's Equity equals $182,000. 
B)  Current Assets are worth $32,000. 
C)  Net Income for the period is $32,000. 
D)  Owner's Equity equals $32,000.

Question 18

A business manager who keeps his/her customers satisfied can be successful without having a great deal of knowledge about accounting practices.

Accepted Answer

A) True 
 B)False

Question 19

As a certified public accountant (CPA),Kay might become involved in helping clients select appropriate accounting computer software for their firm.

Accepted Answer

A) True 
 B)False

Question 20

Gross profit represents profit after the deduction of cost of goods sold,and before the deduction of all other selling expenses,general expenses,and tax expense.

Accepted Answer

A) True 
 B)False

________ measures the speed of inventory moving through the firm and its conversion into sales.

An accountant who works for a single business or government agency is referred to as a:

If the economy began experiencing a prolonged period of deflation in which the prices of most goods are falling,many firms would find that the LIFO method of inventory valuation would result in higher reported profits.

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

In an effort to maintain a competitive advantage,firms do not share accounting information with people outside of the firm.

A statement of cash flows summarizes a company's cash receipts and cash payments over a period of time.

Depreciation is a systematic write-off of the cost of a tangible asset that is listed on __________.

The balance sheet reports revenues and selling costs for a period of time.

Patents and copyrights are examples of intangible assets.

In order to calculate the current ratio for your firm,you divide the total value of current assets by:

During a period of rising prices,if a firm desires to report a low gross profit figure in hopes of reducing their income tax liability,the firm will use the __________ inventory valuation method.

Jose just graduated from college with a bachelor's degree in accounting.He plans to go to work for the American Cancer Society as an accountant.Jose will be a(n):

Accounting software has proven to be especially helpful for small business owners.

FIFO and LIFO are two common:

The Balance Sheet for Renuvation LLC shows assets totaling $107,000 and liabilities totaling $75,000.Which of the following statements is correct?

A business manager who keeps his/her customers satisfied can be successful without having a great deal of knowledge about accounting practices.

As a certified public accountant (CPA),Kay might become involved in helping clients select appropriate accounting computer software for their firm.

Gross profit represents profit after the deduction of cost of goods sold,and before the deduction of all other selling expenses,general expenses,and tax expense.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding How Economics Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Adapting Organizations to Todays Markets

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employee-Management Issues and Relationships

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix A: Using Technology to Manage Information

Appendix B: Managing Risk

Filters

Exam 17: Understanding Accounting and Financial Information

________ measures the speed of inventory moving through the firm and its conversion into sales.

An accountant who works for a single business or government agency is referred to as a:

If the economy began experiencing a prolonged period of deflation in which the prices of most goods are falling,many firms would find that the LIFO method of inventory valuation would result in higher reported profits.

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

In an effort to maintain a competitive advantage,firms do not share accounting information with people outside of the firm.

A statement of cash flows summarizes a company's cash receipts and cash payments over a period of time.

Depreciation is a systematic write-off of the cost of a tangible asset that is listed on __________.

The balance sheet reports revenues and selling costs for a period of time.

Patents and copyrights are examples of intangible assets.

In order to calculate the current ratio for your firm,you divide the total value of current assets by:

During a period of rising prices,if a firm desires to report a low gross profit figure in hopes of reducing their income tax liability,the firm will use the __________ inventory valuation method.

Jose just graduated from college with a bachelor's degree in accounting.He plans to go to work for the American Cancer Society as an accountant.Jose will be a(n):

Accounting software has proven to be especially helpful for small business owners.

FIFO and LIFO are two common:

The Balance Sheet for Renuvation LLC shows assets totaling $107,000 and liabilities totaling $75,000.Which of the following statements is correct?

A business manager who keeps his/her customers satisfied can be successful without having a great deal of knowledge about accounting practices.

As a certified public accountant (CPA),Kay might become involved in helping clients select appropriate accounting computer software for their firm.

Gross profit represents profit after the deduction of cost of goods sold,and before the deduction of all other selling expenses,general expenses,and tax expense.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding How Economics Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Adapting Organizations to Todays Markets

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employee-Management Issues and Relationships

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix A: Using Technology to Manage Information

Appendix B: Managing Risk

Filters