Fucking Financial Accounting Test 1
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- 1.Accounting
- A.
An information system that measures, processes, and communicates financial information about an economic entity
- B.
Asset = liabilities + stock holders equity
- C.
The amount over par value in a corporations contributed capital
- 2.Financial accounting
- A.
The recording of all business transaction in terms of money
- B.
The most important body for developing rules on accounting practice
- C.
The process of generating and communicating accounting information in the form of financial statements to those outside the organization
- 3.Dividends
- A.
Competence and diligence in carrying professional responsibilities
- B.
Distributions to stockholders of assets (usually cash) generated by past earnings
- C.
The economic resources of a company that are expected to benefit future operations
- 4.Management accounting
- A.
The people who have overall responsibility for operating a business and meeting its goals
- B.
The process of producing accounting information for internal use by managers
- C.
The process of producing accounting information for external use by managers
- 5.Financial accounting standards board (fasb) is the most important body for developing rules on accounting practice; it issues statements of financial accounting standards
- A.
True
- B.
False
- 6.Public company accounting oversight board (pcaob) is a governmental body created by the sarbanes-oxley act to regulate the accounting profession
- A.
True
- B.
False
- 7.Balance sheet
- A.
The most common form of stock
- B.
The financial statement that shows a business's assets, liabilities, and stock holders equity as of specific date. also called the statement of financial position
- C.
The value of one currency in terms of another
- 8.Accounting equation
- 9.Assets
- A.
The economic resources of a company that are expected to benefit future operations
- B.
The inflows and outflows of cash into and out of a business
- C.
The most common form of stock
- 10.Liabilities
- A.
Activities undertaken by management to spend capital in productive ways that will help a business achieve its objectives
- B.
Having enough cash available to pay debts when they are due
- C.
A business's present obligations to pay cash, transfer assets, or provide services to other entities in the future
- 11.Equity
- A.
The oversight of a corporation's management and ethics by the board of directors
- B.
A code of conduct that addresses whether actions are right or wrong
- C.
Represents the claims of the owners of a corporation (the shareholders) to the assets of the business.
- 12.Revenues
- A.
Decreases in stockholders equity that result from operating a business
- B.
Increases in stockholders equity that result from operating a business
- 13.Expenses
- A.
Increases in stockholders equity that result from operating a business
- B.
Decreases in stockholders equity that result from operating a business
- 14.Retained earnings
- A.
Stockholders' equity that has been generated by business operations and kept for use in the business
- B.
Impartiality and intellectual honesty
- C.
The recording of all business transactions in terms of money
- 15.Partnership
- A.
A business that is owned by two or more people and that is incorporated
- B.
A business that is owned by two or more people and that is not incorporated
- 16.Corporation
- A.
A business unit granted a state charter recognizing it as separate legal entity having it own rights, privileges, and liabilities distinct from those of its owners.
- B.
The economic resources of a company that are expected to benefit future operations
- 17.Disadvantages of partnership vs corporation: a partnership is the unlimited liability of its owners. unlimited liability can be avoided by organizing the business as a corporation or, in some states, by forming what is known as a limited liability partnership.
- A.
True
- B.
False
- 18.Advantages of partnership vs corporation: it is a part partnership, the owners share the profits and losses of the business, and their personal resources can be called on to pay the obligations of the business.
- A.
True
- B.
False
- 19.Investors
- A.
Stockholders, who invest or may invest in a business and acquire a part ownership in it are interested in its past success and its potential earnings.
- B.
Most companies borrow money for both long and short-term operating needs. those who lend money or deliver goods and services before being paid, are interested mainly in whether a company will have the cash to pay interest charges and to repay the debts at the appropriate time.
- 20.Creditors
- A.
Stockholders, who invest or may invest in a business and acquire a part ownership in it are interested in its past success and its potential earnings.
- B.
Most companies borrow money for both long and short-term operating needs. those who lend money or deliver goods and services before being paid, are interested mainly in whether a company will have the cash to pay interest charges and to repay the debts at the appropriate time.
- 21.Recognition
- A.
The determination of when a business transaction should not be recorded
- B.
The determination of when a business transaction should be recorded
- C.
The simplest form of account, which is used to analyze transactions
- 22.Journal entry is a journal notation that records multiple transactions
- A.
True
- B.
False
- 23.General journal
- A.
A book or file that contains all of a companys accounts arranged in the order of the chart of accounts.
- B.
The practice of recording transactions at cost
- C.
The simplest and most flexible type of journal
- 24.Debit is on the right side of an account
- A.
True
- B.
False
- 25.Credit is on the right side of an account
- A.
True
- B.
False
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