Chapter Twelve: Corporations & Their Financial Statements

56 Questions | Total Attempts: 110

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Chapter Twelve: Corporations & Their Financial Statements - Quiz

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Questions and Answers
  • 1. 
    LOS Question:Describe the structure of the earnings statement and explain the sources of net income(or net earnings).
  • 2. 
    LOS Question:Describe the components of the cash flow statement and classify an accounting activity oritem as a cash flow from operating, financing or investing activities.
  • 3. 
    LOS Question:Explain the importance of the notes to the financial statements and the auditor’s report.
  • 4. 
    I’VE SEEN VARIOUS FORMS OF THE BASIC ACCOUNTING EQUATION. WHICHEQUATION IS CORRECT?
  • 5. 
    HOW DOES A BALANCE SHEET BALANCE WHEN A COMPANY FIRST STARTSOUT?
  • 6. 
    WHAT DOES “CONSOLIDATED” MEAN WHEN WE ARE TALKING ABOUTCONSOLIDATED FINANCIAL STATEMENTS?
  • 7. 
    WHAT ARE THE JOURNAL ENTRIES FOR DIVIDENDS DECLARED AND FOR NEWBOND ISSUES?
  • 8. 
    HOW DOES A COMPANY ESTABLISH THE VALUE OF GOODWILL?
  • 9. 
    CAN YOU PLEASE GIVE ME AN EXAMPLE OF AN INTANGIBLE ASSET WITH AFINITE LIFE
  • 10. 
    CAN A COMPANY WRITE OFF GOODWILL?
  • 11. 
    WHAT IS THE NET ASSET VALUE OF A COMPANY? IS IT RELATED TO BOOKVALUE?
  • 12. 
    HOW COME ISSUED SHARES ARE NOT MENTIONED ON THE BALANCE SHEET?
  • 13. 
    CAN YOU PLEASE EXPLAIN THE DIFFERENCE BETWEEN FIFO AND LIFO WITHAN EXAMPLE?
  • 14. 
    CAN YOU PLEASE EXPLAIN HOW CAPITALIZING A LEASE WORKS?
  • 15. 
    WHAT IS THE PURPOSE OF CAPITALIZING ITEMS ON THE BALANCE SHEET?
  • 16. 
    HOW IS THE DECISION REACHED TO CAPITALIZE AN ITEM ON THE BALANCESHEET?
  • 17. 
    DOES ACCUMULATED APPRECIATION ON THE BALANCE SHEET MEAN THATTHE COMPANY HAS EXTRA CASH AVAILABLE?
  • 18. 
    CAN YOU DISTINGUISH BETWEEN AMORTIZATION, DEPRECIATION ANDDEPLETION? THEY ALL SEEM TO BE THE SAME THING.
  • 19. 
    WHAT IS A SINKING FUND?
  • 20. 
    COULD YOU PLEASE EXPLAIN WHY ACCOUNTING PRINCIPLES WOULD DIFFERFROM GOVERNMENT TAXATION PRINCIPLES?
  • 21. 
    CAN YOU EXPLAIN WHY FUTURE TAXES WOULD SOMETIMES BE RECORDEDAS AN ASSET AND SOMETIMES AS A LIABILITY?
  • 22. 
    HOW COME THE TAXES A COMPANY HAS TO PAY TO THE GOVERNMENT MAYNOT BE THE SAME AS THEY SHOW ON THEIR FINANCIAL STATEMENTS?
  • 23. 
    WHAT SHOULD I REMEMBER REGARDING PERMANENT AND TEMPORARYDIFFERENCES BETWEEN TAX PROVISIONS AND ACTUAL TAX PAYABLE?
  • 24. 
    CAN YOU EXPLAIN WHAT HAPPENS ON THE FINANCIAL STATEMENTS WHEN ABOND IS SOLD AT A PRICE HIGHER THAN PAR?
  • 25. 
    WHAT ARE THE COSTS ASSOCIATED WITH ISSUING A BOND?
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