Question 1

An accounting system is designed to accumulate and classify data about a company's financial activities and summarize them in the general journal.

Accepted Answer

A) True 
 B)False  False

Question 2

How do sole proprietorships, partnerships, and corporations differ?

Accepted Answer

Sole proprietorships-business entities owned by one person who is responsible for the business debts and taxes. The business ends when the owner dies. Partnerships-business entities owned by two or more individuals who are individually, and as a group, responsible for the partnership's debts and taxes. A partnership ends when one or more partners withdraw or die. Corporations-business entities with one or more owners which can continue indefinitely unless bankruptcy occurs or the stockholders vote to liquidate.
Stockholders (owners) are not personally responsible for the corporation's debts and can only lose the amount they invested.

Question 3

Public accounting firms provide three major types of services: auditing, tax accounting, and management advisory services.

Accepted Answer

A) True 
 B)False  True

Question 4

A company issues periodic reports called

Accepted Answer

A) audits. 
B) financial statements. 
C) tax returns. 
D) summaries. 
A) audits. 
B) financial statements. 
C) tax returns. 
D) summaries.

Question 5

Audited financial statements include an auditor's report. What does this auditor's report contain?

Accepted Answer

It contains the auditor's opin

Question 6

Accounting is often referred to as the language of ________.

Accepted Answer

The answer of Accounting is often referred to as the...

Question 7

The Financial Accounting Standards Board has the authority to develop generally accepted accounting principles. Choose the option below that contains the steps used by the FASB in developing GAAP.

Accepted Answer

A) steps include: publishing a notice in the newspaper, seeking public opinion, and issuing a statement of principle. 
B) steps include: issuing a discussion memorandum, filing a legal draft, and notifying the SEC. 
C) steps include: issuing a discussion memorandum, issuing an exposure draft, and issuing a statement of principle. 
D) steps include: filing a complaint with the SEC, issuing an internal report, and issuing a statement of principle. 
A) steps include: publishing a notice in the newspaper, seeking public opinion, and issuing a statement of principle. 
B) steps include: issuing a discussion memorandum, filing a legal draft, and notifying the SEC. 
C) steps include: issuing a discussion memorandum, issuing an exposure draft, and issuing a statement of principle. 
D) steps include: filing a complaint with the SEC, issuing an internal report, and issuing a statement of principle.

Question 8

The SEC uses financial information to determine a company's tax base.

Accepted Answer

A) True 
 B)False

Question 9

When a partner leaves the company, the partnership is dissolved and a new partnership may be formed with the remaining partners.

Accepted Answer

A) True 
 B)False

Question 10

Cullen Company of country X and Shaw Industries of country Y have issued financial statements in compliance with the accounting principles of their respective countries. They would like to work together on a project and need to compare their current financial statements prior to starting the project. However, the accounting principles of the two countries differ. What organization might they turn to regarding this issue? (Give both the full name of the organization and its acronym.)What is the function of this organization?

Accepted Answer

Organization:International Accounting St

Question 11

Owners and managers need financial information in order to

Accepted Answer

A) grant loans. 
B) collect taxes. 
C) make decisions. 
D) issue credit. 
A) grant loans. 
B) collect taxes. 
C) make decisions. 
D) issue credit.

Question 12

An independent accountant who is licensed by the state and provides accounting services to the public for a fee is a

Accepted Answer

A) CMA. 
B) CIA. 
C) CFE. 
D) CPA. 
A) CMA. 
B) CIA. 
C) CFE. 
D) CPA.

Question 13

The following are all government agencies except the

Accepted Answer

A) IRS. 
B) FBI. 
C) SEC. 
D) AICPA. 
A) IRS. 
B) FBI. 
C) SEC. 
D) AICPA.

Question 14

Laws passed by Congress in 1933 and 1934 gave the Securities and Exchange Commission (SEC)final say on matters of financial reporting by publicly owned corporations.

Accepted Answer

A) True 
 B)False

Question 15

There are three general services public accountants offer. List and briefly describe each.

Accepted Answer

Auditing:the review of financial stateme

Question 16

All financial statements submitted to the SEC by publicly owned corporations must include an auditor's report prepared by

Accepted Answer

A) an internal auditor. 
B) an independent certified public accountant. 
C) the firm's managerial accountant. 
D) anyone in the accounting department. 
A) an internal auditor. 
B) an independent certified public accountant. 
C) the firm's managerial accountant. 
D) anyone in the accounting department.

Question 17

The owners and managers of a business are the only users of the financial information.

Accepted Answer

A) True 
 B)False

Question 18

The Securities and Exchange Commission (SEC)regulates the accounting methods and financial reporting of ________ owned corporations.

Accepted Answer

The answer of The Securities and Exchange Commission (SEC)regulates the...

Question 19

Public accountants work on the staff of federal, state, or local governmental units.

Accepted Answer

A) True 
 B)False

Question 20

The ________ (GAAP)must be followed by publicly owned companies and are changed and refined in response to changes in the environment in which businesses operate.

Accepted Answer

generally

Exam 1: Accounting: The Language of Business

An accounting system is designed to accumulate and classify data about a company's financial activities and summarize them in the general journal.

How do sole proprietorships, partnerships, and corporations differ?

Public accounting firms provide three major types of services: auditing, tax accounting, and management advisory services.

A company issues periodic reports called

Audited financial statements include an auditor's report. What does this auditor's report contain?

Accounting is often referred to as the language of ________.

The Financial Accounting Standards Board has the authority to develop generally accepted accounting principles. Choose the option below that contains the steps used by the FASB in developing GAAP.

The SEC uses financial information to determine a company's tax base.

When a partner leaves the company, the partnership is dissolved and a new partnership may be formed with the remaining partners.

Owners and managers need financial information in order to

An independent accountant who is licensed by the state and provides accounting services to the public for a fee is a

The following are all government agencies except the

Laws passed by Congress in 1933 and 1934 gave the Securities and Exchange Commission (SEC)final say on matters of financial reporting by publicly owned corporations.

There are three general services public accountants offer. List and briefly describe each.

All financial statements submitted to the SEC by publicly owned corporations must include an auditor's report prepared by

The owners and managers of a business are the only users of the financial information.

The Securities and Exchange Commission (SEC)regulates the accounting methods and financial reporting of ________ owned corporations.

Public accountants work on the staff of federal, state, or local governmental units.

The ________ (GAAP)must be followed by publicly owned companies and are changed and refined in response to changes in the environment in which businesses operate.

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and Teh Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

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