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Terms in this set (48)
Corporations generally receive more favorable tax treatment than sole proprietorships and corporations.
Which is an advantage of corporations relative to partnerships and sole proprietorships?
Reduced legal liability for investors
Easy transfer of ownership is a characteristic of which form of business organization?
In which forms of business organization are the owners personally liable for all the debts of the business?
Sole proprietorships and partnerships
The sole proprietorship form of business organization
generally receives favorable tax treatment relative to a corporation.
Which forms of business organization are considered to be separate accounting entities?
Sole proprietorships, corporations, and partnerships
Internal users of accounting information include a company's stockholders.
Which of the following is not an external user of accounting data?
Chief Financial Officer
Which statement about users of accounting information is incorrect?
Regulatory authorities are considered internal users
Which of the following did not result from the Sarbanes-Oxley Act?
Tax rates on corporations increased.
Which of the following is the most appropriate definition of accounting information?
The information system that identifies, records, and communicates the economic events of an organization to interested users
Which of the following is required as a result of SOX?
Top management must certify the financial statements for their company.
Interest expense is classified under operating activities on the statement of cash flows.
Paying interest expense and receiving interest revenue are examples of
The payment of dividends is an example of a(n)
Which of the following is not one of the three primary business activities?
Which of the following is an example of a financing activity?
Issuing shares of common stock
Resources owned by a business are referred to as
In terms of the principal types of business activities, paying salaries expense is an example of
What kind of classification is cost of goods sold?
Which of the following would not appear on the income statement?
Which of the following would not appear on the retained earnings statement?
Net income will result during a time period when
revenues exceed expenses.
The balance sheet reports assets and claims to those assets at a specific point in time.
The statement of cash flows reports net income, investing, and financing activities.
In which of the following sequences are the financial statements usually prepared?
Income statement, retained earnings statement, balance sheet, and statement of cash flows
Saira's Maid Service began the year with total assets of $120,000 and stockholders' equity of $40,000. During the year the company earned $90,000 in net income and paid $20,000 in dividends. Total assets at the end of the year were $215,000. How much was stockholders' equity at the end of the year?
Which statement presents information as of a specific point in time?
How is the issuance of common stock reported on the statement of cash flows?
What section of a cash flow statement shows the cash spent on new equipment during the past accounting period?
the investing section
Which financial statement reports assets, liabilities, and stockholders' equity?
The ending retained earnings balance appears on
Both the retained earnings statement and the balance sheet.
Saira's Maid Service began the year with total assets of $120,000 and stockholders' equity of $40,000. During the year the company earned $90,000 in net income and paid $20,000 in dividends. Total assets at the end of the year were $215,000. How much are total liabilities at the end of the year?
The balance sheet
reports the assets, liabilities, and stockholders' equity at a specific date.
If total liabilities decreased by $15,000 and stockholders' equity increased by $5,000 during a period of time, then total assets must change by what amount and direction during that same period?
Stockholders' equity represents
claims of owners.
As of December 31, 2014, Stoneland Corporation has assets of $3,500 and stockholders' equity of $2,000. How much are the liabilities for Stoneland Corporation as of December 31, 2014?
The notes to the financial statements are not required if a company presents all 4 financial statements.
Only Certified Public Accountants may perform audits.
The segment of a corporation's annual report that describes the corporation's accounting methods is the
notes to the financial statements.
The segment of the annual report that presents an opinion regarding the fairness of the presentation of the financial position and results of operations is/are the
When the auditor is satisfied that the financial statements provide a fair representation of the company's financial position and results of operation in accordance with generally accepted accounting principles, the auditor will express
An annual report includes all of the following except
a listing of all of the stockholders.
Which section of the annual report presents highlights of favorable or unfavorable trends and identifies significant events and uncertainties affecting a company's ability to pay near-term obligations, and a company's ability to fund operations and expansion?
Management discussion and analysis
Which of the following are not considered to be primary users of financial statements in countries outside the U.S.?
The most common description of IFRS as contrasted to GAAP is that
GAAP is rules based and IFRS is principles based.
IFRS stands for:
International Financial Reporting Standards.
Which of the five elements of financial statements does the IASB's definitional structure recognize?
Assets, Liabilities, Equity, Income, Expenses
Recommended textbook explanations
Glencoe Accounting: First Year Course
Horngren's Cost Accounting
Charles T. Horngren, Madhav Rajan, Srikant M. Datar
Cost Accounting: A Managerial Emphasis
Charles T. Horngren, Srikant M. Datar
Horngren's Cost Accounting
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