Question 1

Why do U.S.accountants follow generally accepted accounting principles (GAAP)?

Accepted Answer

to ensure accuracy a...

Question 2

_____ earnings are the amounts left over from profitable operations since the firm's beginning.

Accepted Answer

The answer of _____ earnings are the amounts left over...

Question 3

_____ are independent accountants who serve organizations and individuals on a fee basis.

Accepted Answer

A)  Public auditors
B)  Tax reviewers
C)  Financial strategists
D)  Private accountants
E)  Public accountants

Question 4

Profitability ratios measure how well a firm uses its assets.

Accepted Answer

A) True 
 B)False  False

Question 5

The final figure or bottom line on an income statement is called the net revenue.

Accepted Answer

A) True 
 B)False

Question 6

The usual expression of the accounting equation is Assets = Liabilities + Owners' Equity.

Accepted Answer

A) True 
 B)False

Question 7

______ is the final figure or bottom line of an income statement.

Accepted Answer

Net profit...

Question 8

The _____ is a summary of the money flowing into and out of a firm.It is used to assess the sources and uses of cash during a certain period of time

Accepted Answer

statement of cash flows

Question 9

What are the two types of expenses that are shown on a company's income statement?

Accepted Answer

cost of go...

Question 10

The ratio of net profit to the number of shares of common stock outstanding is called the:

Accepted Answer

A)  equity earnings
B)  earnings per share
C)  earnings for profit
D)  stock-to-earnings ratio
E)  profitability index

Question 11

The last step in the accounting cycle is to:

Accepted Answer

A)  analyze business transaction documents
B)  prepare financial statements
C)  analyze financial statements and management reports
D)  prepare trial balance
E)  post entries to ledger

Question 12

_____ is arrived at by subtracting current liabilities from current assets.

Accepted Answer

A)  Net margin
B)  Owners' equity
C)  Net profit
D)  Retained earning
E)  Net working capital

Question 13

International accounting standards:

Accepted Answer

A)  make it easy for an international marketer to rely on global balance sheets and income statements
B)  are supervised by a special agency of the United Nations
C)  all follow GAAP regulations
D)  are required for successful international trade
E)  do not exist

Question 14

The _____ refers to the process of generating financial statements, beginning with a business transaction and ending with the preparation of the report.

Accepted Answer

accounting cycle

Question 15

Which of the following terms equals the total profits of a company minus all dividends (distributions of profits)  to stockholders?

Accepted Answer

A)  owners' equity
B)  net worth
C)  net earnings
D)  retained earnings
E)  current equity

Question 16

_____ accounting provides financial information for managers within the firm to manage, budget, and analyze the progress of the firm.

Accepted Answer

The answer of _____ accounting provides financial information for managers...

Question 17

What is the first step in the accounting cycle?

Accepted Answer

analyze bu...

Question 18

Accounting involves the _____ of the financial activities for firms.

Accepted Answer

A)  delegating
B)  summarizing
C)  creation
D)  empowering
E)  planning

Question 19

_____ is the calculation and interpretation of financial ratios using data taken from the firm's financial statements in order to assess its condition and performance.

Accepted Answer

The answer of _____ is the calculation and interpretation of...

Question 20

_____ are those expenses related to marketing and distributing of a company's products.

Accepted Answer

A)  Functional costs
B)  Administrative expenses
C)  Distribution costs
D)  Selling expenses
E)  Revenue expenses

Exam 14: Using Financial Information and Accounting

Why do U.S.accountants follow generally accepted accounting principles (GAAP)?

Correct Answerverifiedto ensure accuracy a...View AnswerShow Answer

_____ earnings are the amounts left over from profitable operations since the firm's beginning.

Correct AnswerverifiedShow Answer

_____ are independent accountants who serve organizations and individuals on a fee basis.

Correct AnswerverifiedShow Answer

Profitability ratios measure how well a firm uses its assets.

Correct AnswerverifiedFalse

The final figure or bottom line on an income statement is called the net revenue.

Correct AnswerverifiedShow Answer

The usual expression of the accounting equation is Assets = Liabilities + Owners' Equity.

Correct AnswerverifiedShow Answer

______ is the final figure or bottom line of an income statement.

Correct AnswerverifiedNet profit...View AnswerShow Answer

The _____ is a summary of the money flowing into and out of a firm.It is used to assess the sources and uses of cash during a certain period of time

Correct Answerverifiedstatement of cash flows

What are the two types of expenses that are shown on a company's income statement?

Correct Answerverifiedcost of go...View AnswerShow Answer

The ratio of net profit to the number of shares of common stock outstanding is called the:

Correct AnswerverifiedShow Answer

The last step in the accounting cycle is to:

Correct AnswerverifiedShow Answer

_____ is arrived at by subtracting current liabilities from current assets.

Correct AnswerverifiedShow Answer

International accounting standards:

Correct AnswerverifiedShow Answer

The _____ refers to the process of generating financial statements, beginning with a business transaction and ending with the preparation of the report.

Correct Answerverifiedaccounting cycle

Which of the following terms equals the total profits of a company minus all dividends (distributions of profits) to stockholders?

Correct AnswerverifiedShow Answer

_____ accounting provides financial information for managers within the firm to manage, budget, and analyze the progress of the firm.

Correct AnswerverifiedShow Answer

What is the first step in the accounting cycle?

Correct Answerverifiedanalyze bu...View AnswerShow Answer

Accounting involves the _____ of the financial activities for firms.

Correct AnswerverifiedShow Answer

_____ is the calculation and interpretation of financial ratios using data taken from the firm's financial statements in order to assess its condition and performance.

Correct AnswerverifiedShow Answer

_____ are those expenses related to marketing and distributing of a company's products.

Correct AnswerverifiedShow Answer

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to ensure accuracy a...
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False

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Net profit...
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statement of cash flows

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cost of go...
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accounting cycle

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analyze bu...
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