Exam 8: Accounting: Decision Making by the Numbers

Angela is part of the senior management of Fifian Inc., an event management company. She along with other members of the senior management plans the annual budget of the company. Angela, however, is not required to take inputs from or involve the middle and supervisory managers of the company in this planning process. In the given scenario, Fifian Inc. most likely uses _____.

In the context of statement of cash flows, cash flows from operating activities show the amount of cash that flowed into the company from:

Sidney is a member of the Financial Accounting Standards Board (FASB) and is entrusted with the responsibility of establishing accounting principles in the United States. As a member of the board, Sidney:

In order for CPA firms to perform audits with integrity, they must be tied to the firms they audit.

The chief financial officer of the NoveauNoir Production Company requests his accountant, Felipe, to prepare a customized report of the cost overruns at the company's production facility in Los Angeles. In this scenario, Felipe is a managerial accountant.

The members of the Financial Accounting Standards Board (FASB) are appointed by the Securities and Exchange Commission.

__________is the profit or loss a firm earns in the time period covered by the income statement.

A pharmaceutical company wanted to create a budget that was practical and that would enable its managers to make more accurate comparisons between actual costs and budgeted costs. Thus, the company created a budget that was developed over a range of possible sales levels and was designed to show the appropriate budgeted level of costs for each different level of sales. Given this information, which of the following budgets did the company create?

In the context of the income statement of an organization, accountants use accrual-basis accounting when recognizing _____.

Grydon Inc. has applied for a business loan in the United Bank. To best assess the loan case, the loan officer at the bank, Cerejo, decides to look at the company's net income. Cerejo will find this information in Grydon's _____.

Sebastian is an employee at Plowell Inc. His duties include preparing reports and analyzing company data. He also appraises financial performances and verifies the accuracy and validity of the company's internal records. In this scenario, Sebastian's role is that of a _____ in the organization.

Harold, a financial accountant in a company, is asked to identify the changes in the company's account values between 2014 and 2016. To get the required information, he uses comparative financial statements, which state the figures for the two years side by side. These comparative financial statements make it easier for Harold to identify the changes that may have taken place during that period. In this scenario, Harold is most likely using _____ to get the required information.

Lossaire, a jewelry house, needs to increase the company's declining cash inflow through its financing activities. In this context, Lossaire is most likely to:

Acloe Inc., a nutrition bar manufacturing company, plans to commence its budget preparation. The management of the organization comes to a consensus that it will use a budgeting approach that will encourage the active participation of the middle and supervisory managers and consider their suggestions while creating the budget. Acloe Inc. is most likely to adopt the _____ budgeting approach.

Prenora Inc., a newly established company, is set to prepare its first budget. The top management of the company decides to use a budgeting approach that will seek active participation from the middle and supervisory managers of the company. In the given scenario, Prenora Inc. will most likely use the _____ to budgeting.

Betty's job entails detecting problems such as embezzlement, waste, mismanagement, and employee theft at her organization. In this case, Betty is a(n) _____.

The Financial Accounting Standards Board (FASB) is barred from modifying and expanding the generally accepted accounting principles (GAAP).

The Securities and Exchange Commission hires Tim to procure and analyze data on the state's tax revenues and expenditures to ensure that they are recorded and reported in accordance with regulations and requirements. In this case, Tim is most likely a(n) _____.

The Securities and Exchange Commission (SEC) bans publicly traded corporations from making comparative financial statements.

In the context of accounting, which of the following best defines cost?