Chapter 1 Quiz

A  Maintaining records of multiple business transactions.

B  Maintaining records of multiple business transactions, development of more complex societies and exchange of goods and services among individuals.

C  Development of more complex societies.

D  Exchange of goods and services among individuals.

A  Income earned during the current period minus dividends distributed to stockholders’ during the current period.

B  The amount of income earned by the company over its life.

C  The amount of income earned over the company’s life minus the dividends paid to shareholders over the company’s life.

D  Income earned during the current period.

A  A process of measuring income taxes owed to the government.

B  Procedures designed to enhance the company’s image to potential investors.

C  A system of maintaining communication with a company’s customers and suppliers.

D  Measuring a company’s business activities and communicating those measurements to external parties.

A  Securities and Exchange Commission (SEC).

B  International Accounting Standards Board (IASB).

C  Financial Accounting Standards Board (FASB).

D  American Institute of Certified Public Accountants (AICPA).

A  Language of business.

B  Internal reporting structure.

C  Tax allocation system.

D  Mathematical system of equations.

A  Conceptual framework.

B  Auditor’s report.

C  Securities and Exchange Commission.

D  Generally accepted rules.

A  Paying the appropriate amount of taxes.

B  Marketing the company’s products to customers.

C  Making good business decisions.

D  Quality of the work environment for employees.

A  Assets.

B  Liabilities.

C  Expenses.

D  Dividends.

A  Dividend.

B  Asset.

C  Expense.

D  Liability.

A  Suppliers and customers.

B  Tax regulators.

C    

D  Investors and creditors.

E  Government officials.

A  To provide managers with useful information related to human resources.

B  To increase the number of customers for a company.

C  To support the efficient distribution of society’s resources.

D  To support government initiatives through taxation of company profits.

E    

A  Mathematical procedure.

B  Information measurement/communication process.

C  Artistic presentation.

D  Behavioral psychology.

A  Auditors.

B  Tax preparers/planners.

C  Business consultants.

D  Auditors, Business consultants and Tax preparers/planners

A  Stockholders’ equity.

B  Liabilities.

C  Assets.

D  Revenues.

A  Evaluation of internal controls.

B  Business consulting.

C  Tax preparation.

D  Audit of financial statements.

A  Balance Sheet.

B  Statement of Stockholders’ Equity.

C  Income Statement.

D  Statement of Cash Flows.

A  Statement of Stockholders’ Equity.

B  Statement of Cash Flows.

C  Balance Sheet.

D  Income Statement.

A  Comparability.

B  Predictive value.

C  Consistency.

D  Faithful representation.

A  Creditors.

B  Management.

C  Stockholders.

D  Auditors.

A  Total number of employees.

B  Net income

C  Geographic location.

D  Total sales to customers.

A  Liabilities.

B  Dividends.

C  Assets.

D  Expenses.

A  Balance Sheet.

B  Statement of Stockholders’ Equity.

C  Statement of Cash Flows.

D  Income Statement.

A  Truthfulness, clearness.

B  Relevance, comparability.

C  Relevance, truthfulness.

D  Relevance, faithful representation.

A  Balance Sheet.

B  Statement of Cash Flows.

C  Statement of Stockholders’ Equity.

D  Income Statement.

A  Generally Accepted Accounting Principles.

B  General Accounting Accountability Principles.

C  Generally Accepted Auditing Principles.

D  General Accounting and Audit Principles.

A  Costs of providing products or services to customers.

B  Cash paid for the purchase of the company’s long-term resources.

C  Cash paid to investors.

D  Sales of products or services to customers.

A  Government-controlled companies.

B  Professional service firms that traditionally focus on auditing and tax preparation.

C  Companies that sell merchandise to customers.

D  Firms that have stocks listed on an exchange.

A  Income Statement.

B  Balance Sheet.

C  Statement of Stockholders’ Equity.

D  Statement of Cash Flows.

A  Liabilities – Assets = Stockholders’ Equity.

B  Assets + Stockholders’ Equity = Liabilities.

C  Assets = Liabilities + Stockholders’ Equity.

D  Assets + Liabilities = Stockholders’ Equity.