Question 1

Limited liability means the stockholders are not held personally responsible for the financial obligations of the corporation.

Accepted Answer

A) True 
 B)False

Question 2

Investors and creditors rely heavily on financial accounting information in making investment and lending decisions.

Accepted Answer

A) True 
 B)False

Question 3

Materiality is based upon which factor(s)?

Accepted Answer

A) Timeliness of an item. 
B) Amount and nature of an item. 
C) Consistency of an item. 
D) Relevance of an item. 
A) Timeliness of an item. 
B) Amount and nature of an item. 
C) Consistency of an item. 
D) Relevance of an item.

Question 4

Thomason Financial has the following cash transactions for the year.Assume cash at the beginning of the period is $6,000.Prepare a statement of cash flows.

Accepted Answer

The answer of Thomason Financial has the following cash transactions...

Question 5

What is the primary purpose of financial accounting?

Accepted Answer

A) Determine the amount of tax liability owed to the government. 
B) Communicate business transactions to internal management. 
C) Measure business transactions and communicate those measures to external users to make decisions. 
D) Measure the profitability of the company in order to assist employees with making decisions. 
A) Determine the amount of tax liability owed to the government. 
B) Communicate business transactions to internal management. 
C) Measure business transactions and communicate those measures to external users to make decisions. 
D) Measure the profitability of the company in order to assist employees with making decisions.

Question 6

Accountants are responsible for measuring various operating,investing and financing activities.Which of the following correctly matches the activity with its type?

Accepted Answer

A) Investing - paying utilities for the month. 
B) Investing - purchasing land. 
C) Operating - paying dividends to stockholders. 
D) Financing - selling equipment for cash. 
A) Investing - paying utilities for the month. 
B) Investing - purchasing land. 
C) Operating - paying dividends to stockholders. 
D) Financing - selling equipment for cash.

Question 7

For accounting information to be relevant,it should possess which of the following characteristics?

Accepted Answer

A) Predictive value,confirmatory value,and/or materiality. 
B) Large in amount and timely. 
C) Comparability or consistency. 
D) Verifiability. 
A) Predictive value,confirmatory value,and/or materiality. 
B) Large in amount and timely. 
C) Comparability or consistency. 
D) Verifiability.

Question 8

The assumption that a business will continue to operate into the future is the:

Accepted Answer

A) Monetary unit assumption. 
B) Periodicity assumption. 
C) Economic entity assumption. 
D) Going concern assumption. 
A) Monetary unit assumption. 
B) Periodicity assumption. 
C) Economic entity assumption. 
D) Going concern assumption.

Question 9

Consider the following account balances of the Shattuck Law Firm at the end of the year:   How many of these accounts would appear in Shattuck's year-end income statement?

Accepted Answer

A) Five. 
B) Four. 
C) Three. 
D) Two. 
A) Five. 
B) Four. 
C) Three. 
D) Two.

Question 10

Which statement below best describes the accounting equation?

Accepted Answer

A) The change in retained earnings equals net income less dividends. 
B) Equality of revenue and expense transactions over time. 
C) Resources of the company equal creditors' and owners' claims to those resources. 
D) Financing activities equal investing and operating activities. 
A) The change in retained earnings equals net income less dividends. 
B) Equality of revenue and expense transactions over time. 
C) Resources of the company equal creditors' and owners' claims to those resources. 
D) Financing activities equal investing and operating activities.

Question 11

Which financial accounting number impacts stock prices more than any other single piece of information?

Accepted Answer

A) Retained earnings. 
B) Net income. 
C) Common stock. 
D) Total assets. 
A) Retained earnings. 
B) Net income. 
C) Common stock. 
D) Total assets.

Question 12

The financial statement(s)that record activity over an interval of time is (are)the:

Accepted Answer

A) Income statement. 
B) Balance sheet. 
C) Balance sheet and income statement. 
D) Income statement and statement of cash flows. 
A) Income statement. 
B) Balance sheet. 
C) Balance sheet and income statement. 
D) Income statement and statement of cash flows.

Question 13

Which of the following is not a major section in the statement of cash flows?

Accepted Answer

A) Cash flows from operating activities. 
B) Cash flows from customers. 
C) Cash flows from financing activities. 
D) Cash flows from investing activities. 
A) Cash flows from operating activities. 
B) Cash flows from customers. 
C) Cash flows from financing activities. 
D) Cash flows from investing activities.

Question 14

Accounting is a system of maintaining records of a company's operations and communicating this information to decision makers.

Accepted Answer

A) True 
 B)False

Limited liability means the stockholders are not held personally responsible for the financial obligations of the corporation.

Investors and creditors rely heavily on financial accounting information in making investment and lending decisions.

Materiality is based upon which factor(s)?

Thomason Financial has the following cash transactions for the year.Assume cash at the beginning of the period is $6,000.Prepare a statement of cash flows.

What is the primary purpose of financial accounting?

Accountants are responsible for measuring various operating,investing and financing activities.Which of the following correctly matches the activity with its type?

For accounting information to be relevant,it should possess which of the following characteristics?

The assumption that a business will continue to operate into the future is the:

Consider the following account balances of the Shattuck Law Firm at the end of the year: How many of these accounts would appear in Shattuck's year-end income statement?

Which statement below best describes the accounting equation?

Which financial accounting number impacts stock prices more than any other single piece of information?

The financial statement(s)that record activity over an interval of time is (are)the:

Which of the following is not a major section in the statement of cash flows?

Accounting is a system of maintaining records of a company's operations and communicating this information to decision makers.

The Accounting Cycle: During the Period

The Accounting Cycle: End of the Period

Cash and Internal Controls

Receivables and Sales

Inventory and Cost of Goods Sold

Long-Term Assets

Current Liabilities

Long-Term Liabilities

Stockholders Equity

Statement of Cash Flows

Financial Statement Analysis

Time Value of Money

Investments

International Financial Reporting Standards

Filters

Exam 1: A Framework for Financial Accounting

Limited liability means the stockholders are not held personally responsible for the financial obligations of the corporation.

Investors and creditors rely heavily on financial accounting information in making investment and lending decisions.

Materiality is based upon which factor(s)?

Thomason Financial has the following cash transactions for the year.Assume cash at the beginning of the period is $6,000.Prepare a statement of cash flows.

What is the primary purpose of financial accounting?

Accountants are responsible for measuring various operating,investing and financing activities.Which of the following correctly matches the activity with its type?

For accounting information to be relevant,it should possess which of the following characteristics?

The assumption that a business will continue to operate into the future is the:

Consider the following account balances of the Shattuck Law Firm at the end of the year: How many of these accounts would appear in Shattuck's year-end income statement?

Which statement below best describes the accounting equation?

Which financial accounting number impacts stock prices more than any other single piece of information?

The financial statement(s)that record activity over an interval of time is (are)the:

Which of the following is not a major section in the statement of cash flows?

Accounting is a system of maintaining records of a company's operations and communicating this information to decision makers.

The Accounting Cycle: During the Period

The Accounting Cycle: End of the Period

Cash and Internal Controls

Receivables and Sales

Inventory and Cost of Goods Sold

Long-Term Assets

Current Liabilities

Long-Term Liabilities

Stockholders Equity

Statement of Cash Flows

Financial Statement Analysis

Time Value of Money

Investments

International Financial Reporting Standards

Filters