Question 1

A(n) ________ ratio evaluates management's use of assets.

Accepted Answer

A)  financial 
B)  solvency 
C)  activity 
D)  profitability 
E)  liability 
A)  financial 
B)  solvency 
C)  activity 
D)  profitability 
E)  liability

Question 2

If Eric wants to know the cost of obtaining materials to make products that were sold during the year, he would look at the

Accepted Answer

A)  income statement. 
B)  statement of cash flows. 
C)  operating expenses statement. 
D)  balance sheet. 
E)  none of these. 
A)  income statement. 
B)  statement of cash flows. 
C)  operating expenses statement. 
D)  balance sheet. 
E)  none of these.

Question 3

What is the formula for inventory turnover?

Accepted Answer

Cost of go

Question 4

Marla is a private accountant who uses a six-step process to develop and analyze a company's financial reports. The first step in the process is to do a trial balance.

Accepted Answer

A) True 
 B)False

Question 5

Mary Ann is considering buying an existing catering business that is up for sale. The current balance sheet of the business shows that there are has more liabilities than assets. Mary Ann's friend Roland suggests that, even with the negative owners' equity, this business might still be worth buying. What other indicators within the auditor's report should they consider for this decision?

Accepted Answer

It must be determined whether the cateri

Question 6

Don wants to compute the earnings per share for SFX Ltd. How does he do it?

Accepted Answer

A)  Divide sales by the number of common shares outstanding 
B)  Divide cost of goods sold by the number of common shares 
C)  Divide net income by the number of common shares outstanding 
D)  Divide cost of goods sold by average inventory 
E)  Divide net income by sales 
A)  Divide sales by the number of common shares outstanding 
B)  Divide cost of goods sold by the number of common shares 
C)  Divide net income by the number of common shares outstanding 
D)  Divide cost of goods sold by average inventory 
E)  Divide net income by sales

Question 7

Accountants have historically used generally accepted accounting principles when preparing financial reports, but many companies have now switched to the new international accounting standards.

Accepted Answer

A) True 
 B)False

Question 8

Sheena is a private accountant who is working through the accounting cycle. She has completed transferring entries from the journal to a ledger. Her next step is to

Accepted Answer

A)  record transactions in a journal. 
B)  do a trial balance. 
C)  prepare financial statements. 
D)  analyze the financial statements using ratio analysis. 
E)  transfer entries from the journal to the ledger. 
A)  record transactions in a journal. 
B)  do a trial balance. 
C)  prepare financial statements. 
D)  analyze the financial statements using ratio analysis. 
E)  transfer entries from the journal to the ledger.

Question 9

________ is the comprehensive information system for collecting, analyzing, and communicating financial information, while ________ is the recording of financial transactions.

Accepted Answer

A)  Financial accounting; managerial accounting 
B)  Managerial accounting; financial accounting 
C)  Bookkeeping; accounting 
D)  Accounting; bookkeeping 
E)  Controlling; accounting 
A)  Financial accounting; managerial accounting 
B)  Managerial accounting; financial accounting 
C)  Bookkeeping; accounting 
D)  Accounting; bookkeeping 
E)  Controlling; accounting

Question 10

Janice is a private accountant. The first thing she must do when working through the accounting cycle is to

Accepted Answer

A)  record transactions in a journal. 
B)  do a trial balance. 
C)  analyze transaction documents. 
D)  analyze the financial statements using ratio analysis. 
E)  transfer entries from the journal to the ledger. 
A)  record transactions in a journal. 
B)  do a trial balance. 
C)  analyze transaction documents. 
D)  analyze the financial statements using ratio analysis. 
E)  transfer entries from the journal to the ledger.

Question 11

What is the matching principle?

Accepted Answer

The matching principle states

Question 12

What is the formula for the current ratio?

Accepted Answer

Current as

Question 13

Operating income is income before taxes are taken into account.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following scenarios would most likely occur with a company that has reported disappointing earnings recently but still looks to be financially stable for quite some time?

Accepted Answer

A)  High long-term solvency ratio but low profitability ratio 
B)  High short-term solvency ratio but low profitability ratio 
C)  High long-term solvency ratio but low activity ratio 
D)  High short-term solvency ratio but low activity ratio 
E)  High long-term solvency ratio but low short-term solvency ratio 
A)  High long-term solvency ratio but low profitability ratio 
B)  High short-term solvency ratio but low profitability ratio 
C)  High long-term solvency ratio but low activity ratio 
D)  High short-term solvency ratio but low activity ratio 
E)  High long-term solvency ratio but low short-term solvency ratio

Question 15

The financial statement that shows the status of assets, liabilities, and owners' equity at a particular point in time is the balance sheet.

Accepted Answer

A) True 
 B)False

Question 16

Carter Industries had net income of $250 000 for the year. They had 50 000 shares of preferred stock and 200 000 shares of common stock outstanding. What is earnings per share?

Accepted Answer

$250 000/2

Question 17

What is the fundamental purpose of strong ethical standards in accounting?

Accepted Answer

The purpose is to maintain pub

Question 18

Barry is a private accountant who is working through the accounting cycle. He has already analyzed transaction documents. His next step is to

Accepted Answer

A)  record transactions in a journal. 
B)  do a trial balance. 
C)  prepare financial statements. 
D)  analyze the financial statements using ratio analysis. 
E)  transfer entries from the journal to the ledger. 
A)  record transactions in a journal. 
B)  do a trial balance. 
C)  prepare financial statements. 
D)  analyze the financial statements using ratio analysis. 
E)  transfer entries from the journal to the ledger.

A(n) ________ ratio evaluates management's use of assets.

If Eric wants to know the cost of obtaining materials to make products that were sold during the year, he would look at the

What is the formula for inventory turnover?

Marla is a private accountant who uses a six-step process to develop and analyze a company's financial reports. The first step in the process is to do a trial balance.

Don wants to compute the earnings per share for SFX Ltd. How does he do it?

Accountants have historically used generally accepted accounting principles when preparing financial reports, but many companies have now switched to the new international accounting standards.

Sheena is a private accountant who is working through the accounting cycle. She has completed transferring entries from the journal to a ledger. Her next step is to

is the comprehensive information system for collecting, analyzing, and communicating financial information, while is the recording of financial transactions.

Janice is a private accountant. The first thing she must do when working through the accounting cycle is to

What is the matching principle?

What is the formula for the current ratio?

Operating income is income before taxes are taken into account.

Which of the following scenarios would most likely occur with a company that has reported disappointing earnings recently but still looks to be financially stable for quite some time?

The financial statement that shows the status of assets, liabilities, and owners' equity at a particular point in time is the balance sheet.

Carter Industries had net income of $250 000 for the year. They had 50 000 shares of preferred stock and 200 000 shares of common stock outstanding. What is earnings per share?

What is the fundamental purpose of strong ethical standards in accounting?

Barry is a private accountant who is working through the accounting cycle. He has already analyzed transaction documents. His next step is to

Understanding the Canadian Business System

The Environment of Business

Conducting Business Ethically and Responsibly

Entrepreneurship, Small Business, and New Venture Creation

The Global Context of Business

Managing the Business Enterprise

Organizing the Business Enterprise

Managing Human Resources and Labour Relations

Motivating, Satisfying, and Leading Employees

Operations Management, Productivity, and Quality

Understanding Marketing Principles and Developing Products

Pricing, Promotion, and Distributing Products

Money and Banking

Finacial Decisions and Risk Management

Filters

Exam 11: Understanding Accounting

A(n) ________ ratio evaluates management's use of assets.

If Eric wants to know the cost of obtaining materials to make products that were sold during the year, he would look at the

What is the formula for inventory turnover?

Marla is a private accountant who uses a six-step process to develop and analyze a company's financial reports. The first step in the process is to do a trial balance.

Don wants to compute the earnings per share for SFX Ltd. How does he do it?

Accountants have historically used generally accepted accounting principles when preparing financial reports, but many companies have now switched to the new international accounting standards.

Sheena is a private accountant who is working through the accounting cycle. She has completed transferring entries from the journal to a ledger. Her next step is to

________ is the comprehensive information system for collecting, analyzing, and communicating financial information, while ________ is the recording of financial transactions.

Janice is a private accountant. The first thing she must do when working through the accounting cycle is to

What is the matching principle?

What is the formula for the current ratio?

Operating income is income before taxes are taken into account.

Which of the following scenarios would most likely occur with a company that has reported disappointing earnings recently but still looks to be financially stable for quite some time?

The financial statement that shows the status of assets, liabilities, and owners' equity at a particular point in time is the balance sheet.

Carter Industries had net income of $250 000 for the year. They had 50 000 shares of preferred stock and 200 000 shares of common stock outstanding. What is earnings per share?

What is the fundamental purpose of strong ethical standards in accounting?

Barry is a private accountant who is working through the accounting cycle. He has already analyzed transaction documents. His next step is to

Understanding the Canadian Business System

The Environment of Business

Conducting Business Ethically and Responsibly

Entrepreneurship, Small Business, and New Venture Creation

The Global Context of Business

Managing the Business Enterprise

Organizing the Business Enterprise

Managing Human Resources and Labour Relations

Motivating, Satisfying, and Leading Employees

Operations Management, Productivity, and Quality

Understanding Marketing Principles and Developing Products

Pricing, Promotion, and Distributing Products

Money and Banking

Finacial Decisions and Risk Management

Filters

is the comprehensive information system for collecting, analyzing, and communicating financial information, while is the recording of financial transactions.