Major Components Of Financial Reporting F1

20 Questions | By Amphib2007 | Last updated: Mar 20, 2022 | Total Attempts: 224

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Major Components Of Financial Reporting F1 - Quiz

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1.

The two major components of financial reporting are the:
- A.
  
  Annual report and Form 10-K
- B.
  
  Balance sheet and Form 10-K
- C.
  
  Income statement and Form S-K
- D.
  
  Annual report and Form S-K
2.

The report, prepared from financial information, which uses the equation “revenue less expenses equals net income” is called the:
- A.
  
  Statement of financial position
- B.
  
  Income statement
- C.
  
  Balance sheet
- D.
  
  Statement of cash flows
3.

There are several reports prepared from financial accounting information. The report that focuses on the present condition of a business and is based on the model that states “assets must equal liabilities plus owners’ equity” is called the:
- A.
  
  Statement of owners’ equity
- B.
  
  Statement of cash flows
- C.
  
  Income statement
- D.
  
  Balance sheet
4.

The mental and physical efforts of people who are involved in running a business are also referred to as:
- A.
  
  Labor
- B.
  
  Capitalism
- C.
  
  Capital
- D.
  
  Communism
5.

Most countries’ economic health depends on the importing and exporting of goods. However, such commerce among countries can cause:
- A.
  
  An economic complication such as the use of different currencies among nations
- B.
  
  A political complication such as a country wishing to protect its own self-interests
- C.
  
  An economic complication such as countries with different types of economies
- D.
  
  All of the answers above are correct.
6.

A document issued by the FASB that defines the problem, explains issues, and offers several alternatives is a(n):
- A.
  
  New standard
- B.
  
  Task force
- C.
  
  Exposure draft
- D.
  
  Discussion memorandum
7.

To be truly useful to decision-makers, financial statements must be analyzed. Many financial statement users consider the relationship between assets and liabilities on the balance sheet to be extremely important. This relationship is known as the:
- A.
  
  Debt ratio
- B.
  
  Asset-to-liability ratio
- C.
  
  Financial position ratio
- D.
  
  None of these answers are correct.
8.

When compared to a sole proprietorship, partners in a partnership are at a disadvantage because the partners have:
- A.
  
  More management expertise
- B.
  
  To share in the profits
- C.
  
  Fewer government regulations
- D.
  
  No special income taxes to pay
9.

In which respect is a limited partner in a limited partnership "limited"?
- A.
  
  They are limited to corporations
- B.
  
  They are subject to double taxation
- C.
  
  They have limited liability
- D.
  
  They are not permitted to share company profits
10.

One challenge a company faces today is determining exactly who its stakeholders are and what responsibility it has to them. The stakeholders of a company include:
- A.
  
  The community at large
- B.
  
  Investors
- C.
  
  Employees
- D.
  
  All of the answers above are correct
11.

The financial information report that uses the company's net income as one amount in an equation to arrive at the ending amount is knows as:
- A.
  
  Income statement
- B.
  
  Statement of owners' equity
- C.
  
  Statement of cash flows
- D.
  
  Balance sheet
12.

An item that is optional, but often included in the annual report, is the:
- A.
  
  Independent auditors' report
- B.
  
  Management Discussions and Analysis
- C.
  
  Letters to Stockholders
- D.
  
  Consolidated Balance Sheet
13.

A business owner has only limited access to capital to operate and expand his or her business. This disadvantage is a characteristic of the business form known as a:
- A.
  
  Sole proprietorship
- B.
  
  Limited partnership
- C.
  
  Partnership
- D.
  
  Corporation
14.

Which of the following items is optional when included in an annual report?
- A.
  
  Consolidated Statement of Cash Flows
- B.
  
  Managements Discussion and Analysis
- C.
  
  Key Financial Statistics
- D.
  
  Independent Auditors' Report
15.

A person who is willing to accept the opportunities and risks of starting a business is a(n):
- A.
  
  Independent contractor
- B.
  
  Outside board member
- C.
  
  Entrepreneur
- D.
  
  Employee
16.

When the auditor states an exception to the audit report, he/she issues a(n):
- A.
  
  Adverse opinion
- B.
  
  Unqualified opinion
- C.
  
  Qualified opinion
- D.
  
  Disclaimer
17.

Many companies today are committed to responsible and ethical business practices, and they make it a point of communicating that commitment to investors, employees, and the general public. Anyone to whom the company owes a responsibility is called a(n):
- A.
  
  Corporate officer
- B.
  
  Investor
- C.
  
  Stakeholder
- D.
  
  Competitor
18.

A form of business that allows the individual to take risks and reap the rewards of ownership and any profitability is known as a:
- A.
  
  Sole proprietorship
- B.
  
  Limited partnership
- C.
  
  Partnership
- D.
  
  Corporation
19.

________ is (are) the things of value a company owns or controls, and __________ represent(s) the debts or obligations of the company.
- A.
  
  Assets; liabilities
- B.
  
  Assets; owners’ equity
- C.
  
  Liabilities; assets
- D.
  
  Owners’ equity; liabilities
20.

Jasmine sells flowers for $25 per bunch. The flowers cost Jasmine $14 per bunch. The delivery driver charges $5 per delivery and the clerk is paid $2 for each order processed. If Jasmine sells 8 bunches of flowers, what is the net income that she'll receive?
- A.
  
  $28
- B.
  
  $32
- C.
  
  $4
- D.
  
  $11