5 Written Questions

1. Outflows or using up of assets as part of operations of a business to generate sales
2. Area of accounting aimed mainly at serving external users
3. Corporation's basic ownership share; also generically called capital stock
4. Resources a business owns or controls that are expected to provide current and future benefits to the business
5. Principle that prescribes financial statements to reflect the assumption that the business will continue operating

5 Matching Questions

1. Shareholders
2. Liabilities
3. Balance Sheet
4. Income Statement
5. Sarbanes-Oxley Act (SOX)

1. a Creditors' claims on an organization's assets; involves a probable future payment of assets, products or services that a company is obligated to make due to past transactions or events.
2. b Helps curb financial abuses at companies that issue their stock to the public by oversight and stringent internal controls in the hopes that reports are more truthful and transparent
3. c Financial statement that subtracts expenses from revenues to yield a net income or loss over a specified PERIOD OF TIME; also includes any gains or losses
4. d Financial statement that lists types and dollar amounts of assets, liabilities and equity at a SPECIFIC date
5. e Owners of a corporation; also called stockholders

5 Multiple Choice Questions

1. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public
   1. Business Entity Assumption
   2. Return on Assets (ROA)
   3. Sarbanes-Oxley Act (SOX)
   4. Securities and Exchange Commission (SEC)
2. Information and measurement system that identifies, records, and communicates relevant information about a company's business activities
   1. Assets
   2. Accounting
   3. Return
   4. Audit
3. Prescribes that accounting for items that significantly impact financial statement and any inferences from them adhere strictly to GAAP
   1. Managerial Accounting
   2. Financial Accounting
   3. Materiality Constraint
   4. Cost-Benefit Constraint
4. Revenue is recognized when earned
   1. Matching (Or Expense Recognition) Principle
   2. Cost Principle
   3. Measurement Principle
   4. Revenue Recognition Principle
5. Unincorporated association of two or more persons to pursue a business for profit as co-owners
   1. Partnership
   2. Assets
   3. Balance Sheet
   4. Proprietorship

5 True/False Questions

1. Audit → Analysis and report of an organization's accounting system, its records, and its reports using various tests

   True        False

2. Net Income → Monies received from an investment; often in percent form

   True        False

3. Shares → Equity of a corporation divided into ownership units; also called stock

   True        False

4. International Accounting Standards Board (IASB) → Independent group of full-time members responsible for setting accounting rules

   True        False

5. Managerial Accounting → Area of accounting aimed mainly at serving the decision-making needs of internal users

   True        False