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________ are more concept-based than ________.


A) IFRS; U.S.GAAP
B) U) S.GAAP; IFRS
C) This is a trick question,since U.S.GAAP and IFRS are the same.
D) IGAAP; U.S.GAAP

E) All of the above
F) A) and B)

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Lisa Vogle has been running the Bird's Nest Inn since the death of her husband.Common sense tells Lisa that she should take some action to protect the assets of the business and the financial records.Explain the basic concepts of internal control to Lisa.

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Internal controls are the policies and p...

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An accrual transaction is one in which ________.


A) the action comes before the cash
B) cash comes before the action
C) a company postpones recognizing cash transactions
D) the exchange of cash coincides with the economic substance of a transaction

E) A) and B)
F) C) and D)

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Reliable information ________.


A) needs to be current so it can be used to make decisions
B) can be verified as accurate and truthful
C) allows users to make comparisons across financial statements
D) is presented the same way period after period

E) All of the above
F) A) and B)

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The accountant called the bank after noticing that a $200 deposit made on July 21 did not appear on the July 31 bank statement.This call is an example of a ________.


A) business control
B) detective control
C) corrective control
D) preventive control

E) A) and B)
F) A) and D)

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Adjusting the books is done ________.


A) every time a sale is made
B) every time an asset is purchased
C) as expenses are used up
D) at the end of every accounting period

E) C) and D)
F) A) and D)

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Characteristics of useful information include ________.


A) rationality and reliability
B) comparability and consistency
C) materiality and conservatism
D) comprehensive and complete

E) B) and D)
F) A) and B)

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Corrective controls include ________.


A) requiring authorization for certain transactions
B) limiting access to assets
C) requiring passwords to access the computerized accounting records
D) procedures for handling any errors that are detected

E) B) and C)
F) C) and D)

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The three basic elements of the income statement are ________.


A) operating activities,investing activities,and financing activities
B) assets,liabilities,and shareholders' equity
C) revenues,expenses,and net income or loss
D) retained earnings,net income,and dividends

E) B) and C)
F) All of the above

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Use the following information for DeltaCo for the year ended December 31,2011 to answer the questions below.Assume no new common stock was issued during the year. Use the following information for DeltaCo for the year ended December 31,2011 to answer the questions below.Assume no new common stock was issued during the year. 1.What were the total revenues for the year? 2.What was the dividend during the year? 3.What were the total liabilities on the balance sheet at December 31,2011? 4.How much is contributed capital at December 31,2011? 1.What were the total revenues for the year? 2.What was the dividend during the year? 3.What were the total liabilities on the balance sheet at December 31,2011? 4.How much is contributed capital at December 31,2011?

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1.$900 = $700 + 200
...

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A classified balance sheet shows subtotals for ________.


A) revenues and expenses
B) current assets,long-term assets,current liabilities,long-term liabilities and shareholders' equity
C) operating activities,investing activities and financing activities
D) retained earnings,net income,and dividends

E) A) and D)
F) All of the above

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On December 31,2012,Twisted Pretzel was told by an appraiser that its land,which cost $100,000,was worth $120,000.How should Twisted Pretzel show this information on its financial statements prepared under U.S.GAAP?


A) Report a gain of $20,000 on its income statement.
B) Report land at $100,000 on its income statement.
C) Report land at $120,000 on its income statement.
D) Continue showing the land at its cost of $100,000.

E) B) and C)
F) A) and B)

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Which of the following is an example of using the materiality concept?


A) recording significant purchases as assets even though technically they are considered expenses
B) recording insignificant purchases as expenses even though technically they are considered assets
C) not recording insignificant purchases at all
D) recording insignificant liabilities as assets

E) A) and B)
F) All of the above

Correct Answer

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The SEC has ________.


A) ordered all U.S.companies to begin using IFRS immediately
B) ruled that U.S.companies may never use IFRS for financial reporting
C) established a time table for the convergence of U.S.GAAP and IFRS
D) established an International Accounting Standards Board to create international accounting rules

E) A) and B)
F) C) and D)

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Team Shirts has $189,000 in total current assets and $165,000 in total current liabilities.Calculate the current ratio for Team Shirts.Round your answer to one decimal place.

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$189,000/$...

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Team Shirts has $233,000 in total current assets and $141,500 in total current liabilities. 1.Calculate the current ratio (rounded to one decimal place)for Team Shirts. 2.Is this a more favorable ratio than 0.9 to 1?

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1.$233,000/$141,500 ...

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All of Team Shirts' financial statements are presented in U.S.dollars.The accounting rule that applies is the ________.


A) separate-entity assumption
B) going-concern assumption
C) monetary-unit assumption
D) historical-cost principle

E) A) and B)
F) A) and C)

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Name one type of detective control that would be useful in a computerized information system.

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A detective control ...

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The monetary-unit assumption refers to ________.


A) measuring financial statement items at their cost at the time of the transaction
B) an assumption that a company will continue to be in business in the future
C) the use of monetary units,such as dollars,to measure the value of financial statement amounts
D) the way revenues and expenses are recognized

E) A) and B)
F) A) and C)

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The four basic financial statements are the ________.


A) income statement,balance sheet,statement of changes in shareholders' equity,and cash budget
B) income statement,balance sheet,cash budget,and statement of cash flows
C) income statement,balance sheet,statement of changes in shareholders' equity,and statement of cash flows
D) balance sheet,shareholders' equity,statement of cash flows,and cash budget

E) B) and D)
F) A) and C)

Correct Answer

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