Accounting Quiz10

18 Questions  I  By Baybayev
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Accounting Quizzes & Trivia

  
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  • 1. 
    The SEC has usually restricted its role in establishing accounting principles to
    • A. 

      Developing accounting standards for particular industries.

    • B. 

      B. specifying the information that should be included in interim financial statements.

    • C. 

      The promulgation and issuance of SASs (Securities Accounting Standards).

    • D. 

      Determining required disclosures.

    • E. 

      Developing definitions of key accounting terms.


  • 2. 
    The SEC's role in the initial registration of securities to be publicly issued is:
    • A. 

      To provide data to the public regarding first-time issuance of securities.

    • B. 

      To give permission to an independent CPA firm to audit the registrant's financial statements.

    • C. 

      To ensure that the content of the registration filing is in compliance with securities regulations.

    • D. 

      To make the registrant's annual report available for public viewing.

    • E. 

      To ensure that securities issued are quality investments.


  • 3. 
    The goals of the SEC include all except which one of the following?
    • A. 

      Prohibiting the dissemination of materially misstated information

    • B. 

      Regulating the operation of securities markets.

    • C. 

      Ensuring that full and fair information is disclosed to all investors before the securities of a company are allowed to be bought and sold.

    • D. 

      Controlling the number of companies whose stock is listed on major stock exchanges.

    • E. 

      Preventing the misuse of information especially by inside parties.


  • 4. 
    A letter of comments would be issued by the SEC
    • A. 

      After receiving the company's Form 10-K.

    • B. 

      To indicate that a registration statement has been approved.

    • C. 

      To request clarification of a registration statement.

    • D. 

      In response to a company's filing of Form 8-K.

    • E. 

      To convey your pertinent comments to the SEC.


  • 5. 
    How has the SEC exercised its power with regard to the continuing evolution of accounting principles? (1) Issuing Financial Reporting Releases (FRRs). (2) Requiring additional disclosures in notes to financial statements. (3) Declaring a moratorium on the use of specified accounting practices. (4) Overruling the FASB.
    • A. 

      1,2,4

    • B. 

      1,3,4

    • C. 

      1,3

    • D. 

      1,2,3,4

    • E. 

      1,4


  • 6. 
    EDGAR stands for:
    • A. 

      Explanatory Data Gathering, Analysis, and Retrieval System.

    • B. 

      Electronic Data, Gross Analysis, and Revenues System.

    • C. 

      Electronic Data Gathering, Analysis, and Retrieval System.

    • D. 

      Electronic Debits, Gains, Assets and Revenues System.

    • E. 

      Explanatory Debits, Gains, Assets and Revenues System.


  • 7. 
    Filings with the SEC are divided generally into two broad categories:
    • A. 

      Registration statements and periodic filings.

    • B. 

      Reconciliation statements and periodic filings.

    • C. 

      Registration filings and reconciliation statements.

    • D. 

      Registration statements and perpetual filings.

    • E. 

      Reconciliation filings and perpetual filings.


  • 8. 
    Regulation S-K:
    • A. 

      Establishes requirements for nonfinancial information to be filed with the SEC.

    • B. 

      Prescribes the financial disclosure information that must be included in filings with the SEC.

    • C. 

      Controls the listing of securities by stock exchanges.

    • D. 

      Describes the internal controls a publicly traded company must maintain.

    • E. 

      Prescribes the form of financial statements to be filed with the SEC.


  • 9. 
    Audited financial statements in an annual report of an issuer that is subject to SEC regulation must include:
    • A. 

      Three balance sheets, two income statements, and two statements of cash flows.

    • B. 

      Two balance sheets, two income statements, and two statements of cash flows.

    • C. 

      Two balance sheets, three income statements, and three statements of cash flows.

    • D. 

      One balance sheet, one income statement, and one statement of cash flows.

    • E. 

      Three balance sheets, three income statements, and three statements of cash flows.


  • 10. 
    The audit committee of an entity subject to SEC regulation will do all of the following except:
    • A. 

      Sign certification of the annual financial statements.

    • B. 

      Approve nonaudit services provided by the independent audit firm.

    • C. 

      Be comprised only of individuals who are not members of management.

    • D. 

      Be responsible for agreeing to fee compensation of the independent audit firm.

    • E. 

      Serve as liaison between the board of directors and the independent audit firm.


  • 11. 
    Regulation S-X specifies:
    • A. 

      Requirements for the nonfinancial information to be filed with the SEC.

    • B. 

      The internal controls a publicly traded company must maintain.

    • C. 

      Which form a company must file to register new securities.

    • D. 

      The form and content of financial statements to be filed with the SEC.

    • E. 

      That the financial statements included in a company's annual report must be audited.


  • 12. 
    A wrap-around filing:
    • A. 

      May be used by large companies to sell securities over a period of two years without refiling with the SEC.

    • B. 

      May remain in effect for a period of one to five years

    • C. 

      Is a filing completed using the SEC's electronic filing system.

    • D. 

      Allows a company to simplify its form 10-K by referring to information in its annual report.

    • E. 

      Is a simplified registration procedure for securities to be issued by small companies.


  • 13. 
    Which one of the following registration statement forms is used by large issuers that already have at least $75 million voting stock held by nonaffiliates?
    • A. 

      S-1

    • B. 

      S-8

    • C. 

      S-11

    • D. 

      S-3

    • E. 

      S-4


  • 14. 
    Information required in proxy statements includes all except which of the following?
    • A. 

      Listing of company directors and executive officers.

    • B. 

      Two-year summary of industry segments, export sales, and foreign and domestic operations.

    • C. 

      Five-year summary of operations including sales, total assets, income from continuing operations, and cash dividends per share.

    • D. 

      Description of the business activities including principal products and sources and availability of raw materials.

    • E. 

      Market price of the company's common stock for each quarterly period within the two most recent fiscal years.


  • 15. 
    A proxy statement must be filed with the SEC at least how many days before being distributed?
    • A. 

      90

    • B. 

      70

    • C. 

      10

    • D. 

      30

    • E. 

      60


  • 16. 
    P Co. is preparing to issue stock. Its revenues for last year were $85,000,000, and it had $52,000,000 in stock held by nonaffiliates. The company had been filing with the SEC for eight years. Which one of the following forms should have been used for registration?
    • A. 

      S-3

    • B. 

      S-8

    • C. 

      S-4

    • D. 

      S-1

    • E. 

      S-11


  • 17. 
    When must Form 8-K be filed with the SEC?
    • A. 

      Within ninety days of the end of the fiscal year.

    • B. 

      When a relatively small company intends to issue securities.

    • C. 

      Within fifteen days of the occurrence of certain significant events.

    • D. 

      Within forty-five days of the end of any quarter other than the fourth quarter of the fiscal year.

    • E. 

      Within sixty days of the end of the fiscal year.


  • 18. 
    When preparing a consolidation worksheet for a parent and its foreign subsidiary accounted for under the equity method, which of the following statements is false?
    • A. 

      The excess of fair value over book value since the date of acquisition is revalued for the change in exchange rate.

    • B. 

      The subsidiary's stockholders' equity accounts as of the beginning of the year are eliminated.

    • C. 

      The cumulative translation adjustment included in the Investment in Subsidiary account is eliminated.

    • D. 

      The allocations of excess of fair value over book value at the date of acquisition are eliminated.

    • E. 

      The amount of equity income recognized by the parent in the current year is eliminated .


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