Chapter 1 Quiz

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

B  Maintaining records of multiple business transactions.

C  Exchange of goods and services among individuals.

D  Development of more complex societies.

A  Income earned during the current period.

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

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

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

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

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

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

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

A  Financial Accounting Standards Board (FASB).

B  American Institute of Certified Public Accountants (AICPA).

C  Securities and Exchange Commission (SEC).

D  International Accounting Standards Board (IASB).

A  Tax allocation system.

B  Mathematical system of equations.

C  Language of business.

D  Internal reporting structure.

A  Conceptual framework.

B  Generally accepted rules.

C  Securities and Exchange Commission.

D  Auditor’s report.

A  Marketing the company’s products to customers.

B  Making good business decisions.

C  Quality of the work environment for employees.

D  Paying the appropriate amount of taxes.

A  Dividends.

B  Expenses.

C  Liabilities.

D  Assets.

A  Asset.

B  Liability.

C  Dividend.

D  Expense.

A    

B  Government officials.

C  Investors and creditors.

D  Suppliers and customers.

E  Tax regulators.

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

B    

C  To support government initiatives through taxation of company profits.

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

E  To increase the number of customers for a company.

A  Artistic presentation.

B  Information measurement/communication process.

C  Mathematical procedure.

D  Behavioral psychology.

A  Business consultants.

B  Auditors.

C  Tax preparers/planners.

D  Auditors, Business consultants and Tax preparers/planners

A  Liabilities.

B  Stockholders’ equity.

C  Assets.

D  Revenues.

A  Business consulting.

B  Audit of financial statements.

C  Evaluation of internal controls.

D  Tax preparation.

A  Balance Sheet.

B  Statement of Cash Flows.

C  Statement of Stockholders’ Equity.

D  Income Statement.

A  Statement of Cash Flows.

B  Income Statement.

C  Balance Sheet.

D  Statement of Stockholders’ Equity.

A  Consistency.

B  Faithful representation.

C  Predictive value.

D  Comparability.

A  Auditors.

B  Stockholders.

C  Creditors.

D  Management.

A  Geographic location.

B  Net income

C  Total sales to customers.

D  Total number of employees.

A  Dividends.

B  Expenses.

C  Liabilities.

D  Assets.

A  Income Statement.

B  Statement of Stockholders’ Equity.

C  Balance Sheet.

D  Statement of Cash Flows.

A  Relevance, faithful representation.

B  Relevance, truthfulness.

C  Truthfulness, clearness.

D  Relevance, comparability.

A  Statement of Cash Flows.

B  Statement of Stockholders’ Equity.

C  Balance Sheet.

D  Income Statement.

A  Generally Accepted Accounting Principles.

B  Generally Accepted Auditing Principles.

C  General Accounting Accountability Principles.

D  General Accounting and Audit Principles.

A  Cash paid to investors.

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

C  Costs of providing products or services to customers.

D  Sales of products or services to customers.

A  Firms that have stocks listed on an exchange.

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

C  Companies that sell merchandise to customers.

D  Government-controlled companies.

A  Statement of Stockholders’ Equity.

B  Balance Sheet.

C  Statement of Cash Flows.

D  Income Statement.

A  Assets = Liabilities + Stockholders’ Equity.

B  Assets + Liabilities = Stockholders’ Equity.

C  Liabilities – Assets = Stockholders’ Equity.

D  Assets + Stockholders’ Equity = Liabilities.