Question 1

The Public Company Accounting Oversight Board was created by the

Accepted Answer

A) Sarbanes-Oxley Act. 
B) GASB. 
C) IRS. 
D) IASB. 
A) Sarbanes-Oxley Act. 
B) GASB. 
C) IRS. 
D) IASB.

Question 2

List five possible users of a set of financial statements and state what each would be interested in learning from its review.

Accepted Answer

Possible users and their reasons for int

Question 3

Misleading financial reports are not considered fraudulent if they are the result of the misapplication of accounting principles.

Accepted Answer

A) True 
 B)False

Question 4

Financing a business means obtaining funds so the business can begin and continue operating.

Accepted Answer

A) True 
 B)False

Question 5

The purchase of equipment is an example of an investing activity.

Accepted Answer

A) True 
 B)False

Question 6

Sinoyianis Realty Company had the following balance sheet accounts and balances: 
 
-If the equipment were sold for $14,000,what would be the total of stockholders' equity?

Accepted Answer

A) $8,000 
B) $22,000 
C) $36,000 
D) $40,000 
A) $8,000 
B) $22,000 
C) $36,000 
D) $40,000

Question 7

Buying and selling goods and services are examples of operating activities.

Accepted Answer

A) True 
 B)False

Question 8

All of the following are considered nonexchange transactions except

Accepted Answer

A) the day-by-day accumulation of interest. 
B) the wear and tear on machinery. 
C) the sale of goods and services. 
D) losses from fire,flood,and theft. 
A) the day-by-day accumulation of interest. 
B) the wear and tear on machinery. 
C) the sale of goods and services. 
D) losses from fire,flood,and theft.

Question 9

Feldman Company had a balance of $360,000 in Retained Earnings on December 31,2013.During 2014,the company reported a net income of $48,000,and dividends of $36,000 were paid.Prepare the company's statement of retained earnings for the year ended December 31,2014.

Accepted Answer

The answer of Feldman Company had a balance of $360,000...

Question 10

Payment to a creditor is an example of a nonexchange business transaction.

Accepted Answer

A) True 
 B)False

Question 11

The primary external users of accounting information are investors and management.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following financial statements is concerned with the enterprise at a point in time?

Accepted Answer

A) Statement of retained earnings 
B) Income statement 
C) Statement of cash flows 
D) Balance sheet 
A) Statement of retained earnings 
B) Income statement 
C) Statement of cash flows 
D) Balance sheet

Question 13

Which of the following transactions does not involve an exchange of value?

Accepted Answer

A) Payment of a debt 
B) Purchase of a building on credit 
C) Borrowing money 
D) Loss from theft 
A) Payment of a debt 
B) Purchase of a building on credit 
C) Borrowing money 
D) Loss from theft

Question 14

Which of the following is the most appropriate definition of accounting?

Accepted Answer

A) Electronic collection,organization,and communication of vast amounts of information 
B) The interconnected network of subsystems necessary to operate a business 
C) A means of recording transactions and keeping records 
D) The measurement,processing,and communication of financial information about an identifiable economic entity 
A) Electronic collection,organization,and communication of vast amounts of information 
B) The interconnected network of subsystems necessary to operate a business 
C) A means of recording transactions and keeping records 
D) The measurement,processing,and communication of financial information about an identifiable economic entity

Question 15

Why would it be less risky for an individual to incorporate his or her business rather than to operate it as a sole proprietorship or partnership?

Accepted Answer

With a sole proprietorship or partnershi

Question 16

The Sarbanes-Oxley Act of 2002 came,in part,as a result of the

Accepted Answer

A) Enron scandal. 
B) WorldCom scandal. 
C) Target scandal. 
D) Enron and WorldCom scandals. 
A) Enron scandal. 
B) WorldCom scandal. 
C) Target scandal. 
D) Enron and WorldCom scandals.

Question 17

For accounting purposes,a business and its owner are considered the same entity.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following might be motivation for fraudulently covering up a financial weakness?

Accepted Answer

A) To obtain a loan 
B) To meet stockholder expectations 
C) To obtain bonus compensation 
D) All of these are possible motivations 
A) To obtain a loan 
B) To meet stockholder expectations 
C) To obtain bonus compensation 
D) All of these are possible motivations

Question 19

Which of the following groups uses accounting information primarily to help protect the public?

Accepted Answer

A) Management 
B) Regulatory agencies 
C) Taxing authorities 
D) Economic planners 
A) Management 
B) Regulatory agencies 
C) Taxing authorities 
D) Economic planners

Question 20

All of the following are broad principles underlying the accountant's code of professional ethics except

Accepted Answer

A) objectivity. 
B) integrity. 
C) loyalty. 
D) independence. 
A) objectivity. 
B) integrity. 
C) loyalty. 
D) independence.

Exam 1: Uses of Accounting Information and the Financial Statements

The Public Company Accounting Oversight Board was created by the

List five possible users of a set of financial statements and state what each would be interested in learning from its review.

Misleading financial reports are not considered fraudulent if they are the result of the misapplication of accounting principles.

Financing a business means obtaining funds so the business can begin and continue operating.

The purchase of equipment is an example of an investing activity.

Sinoyianis Realty Company had the following balance sheet accounts and balances: -If the equipment were sold for $14,000,what would be the total of stockholders' equity?

Buying and selling goods and services are examples of operating activities.

All of the following are considered nonexchange transactions except

Feldman Company had a balance of $360,000 in Retained Earnings on December 31,2013.During 2014,the company reported a net income of $48,000,and dividends of $36,000 were paid.Prepare the company's statement of retained earnings for the year ended December 31,2014.

Payment to a creditor is an example of a nonexchange business transaction.

The primary external users of accounting information are investors and management.

Which of the following financial statements is concerned with the enterprise at a point in time?

Which of the following transactions does not involve an exchange of value?

Which of the following is the most appropriate definition of accounting?

Why would it be less risky for an individual to incorporate his or her business rather than to operate it as a sole proprietorship or partnership?

The Sarbanes-Oxley Act of 2002 came,in part,as a result of the

For accounting purposes,a business and its owner are considered the same entity.

Which of the following might be motivation for fraudulently covering up a financial weakness?

Which of the following groups uses accounting information primarily to help protect the public?

All of the following are broad principles underlying the accountant's code of professional ethics except

Measurement Concepts: Recording Business Transactions

Measuring Business Income: Adjusting the Accounts

Foundations of Financial Reporting and the Classified Balance Sheet

Accounting for Merchandising Operations

Inventories

Cash and Internal Control

Receivables

Long-Term Assets

Current Liabilities and Fair Value Accounting

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting and Cost Concepts

Costing Systems: Job Order Costing

Costing Systems: Process Costing

Value-Based Systems: Activity-Based Costing and Lean Accounting

Cost-Volume-Profit Analysis

The Budgeting Process

Flexible Budgets and Performance Analysis

Standard Costing and Variance Analysis

Short-Run Decision Analysis

Capital Investment Analysis

Pricing Decisions, including Target Costing and Transfer Pricing

Quality Management and Measurement

Accounting for Unincorporated Businesses

Accounting for Investments

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