Question 1

How would it be easier to determine if a firm made or lost money last year-by looking at the balance sheet or by looking at the income statement? Support your answer by explaining in general terms what accounts a balance sheet lists and what accounts an income statement lists.

Accepted Answer

The quickest way to determine if a firm ...

Question 2

The process of spreading the cost of a fixed asset over the asset's useful life is called

Accepted Answer

A)   expensing.
B)   depreciation.
C)   apportioning.
D)   crediting.
E)   distributing.F) A) and E)
G) None of the above

Question 3

On a balance sheet,assets are listed in order,from the most liquid to the least liquid.

Accepted Answer

A) True 
 B)False

Question 4

Debts that are to be repaid in two years are referred to as

Accepted Answer

A)   expenses.
B)   current assets.
C)   long-term liabilities.
D)   fixed assets.
E)   current liabilities.F) B) and E)
G) None of the above

Question 5

Cassie has worked for one week but her employer only pays its employees every two weeks.The amount of money her company owes her is classified as

Accepted Answer

A)   accounts notable.
B)   accounts receivable.
C)   notes payable.
D)   prepaid wages.
E)   salaries payable.F) A) and B)
G) B) and E)

Question 6

The cost of goods sold for Peterson Fashions is $360,000.The beginning inventory for the firm was $20,000.Twelve months later the ending inventory was $40,000.What is the firm's inventory turnover?

Accepted Answer

A)   6 times a year
B)   9 times a year
C)   12 times a year
D)   18 times a year
E)   24 times a yearF) B) and D)
G) C) and D)

Question 7

The value of goods on hand for sale to customers is called

Accepted Answer

A)   sales.
B)   merchandise inventory.
C)   cost of goods sold.
D)   prepaid expenses.
E)   operating expenses.F) D) and E)
G) A) and D)

Question 8

The cash that Coca-Cola receives from providing customers with Coke and other soft drinks and juices would appear in the ____ section of the statement of cash flows.

Accepted Answer

A)   financing
B)   business
C)   receiving
D)   operating
E)   investingF) B) and D)
G) A) and B)

Question 9

Cindy provides piano lessons to students in her home four days a week.The money she earns from providing these services would be called ____ on an income statement.

Accepted Answer

A)   expenses
B)   cash
C)   revenues
D)   retained earnings
E)   equityF) B) and E)
G) All of the above

Question 10

Most data gathered for an MIS come from

Accepted Answer

A)   customers.
B)   bankers.
C)   external sources.
D)   internal sources.
E)   information obtained from data firms.F) A) and B)
G) B) and D)

Question 11

In 1987,the Securities and Exchange Commission (SEC)and the Financial Accounting Standards Board (FASB)required all publicly traded companies to include a statement of cash flows along with the balance sheet and income statement in their annual report.

Accepted Answer

A) True 
 B)False

Question 12

The value of a firm's stock plus any retained earnings that have accumulated to date is referred to as

Accepted Answer

A)   current assets.
B)   long-term liabilities.
C)   fixed assets.
D)   owners' equity.
E)   revenue.F) C) and D)
G) B) and E)

Question 13

The current ratio is calculated by dividing

Accepted Answer

A)   current assets by owners' equity.
B)   current assets by current liabilities.
C)   income by operating expenses.
D)   net sales after taxes by net sales.
E)   accounts receivable by inventory turnover.F) A) and D)
G) A) and E)

Question 14

Dividing current assets by current liabilities gives the current ratio.

Accepted Answer

A) True 
 B)False

Question 15

​What is the average inventory of a business that turns over inventory 10.0 times a year and has a cost of goods sold of $300,000?

Accepted Answer

A)   ​$30,000
B)   ​$300,010
C)   ​$ 3,000,000
D)   ​$ 3,000E) None of the above
F) B) and D)

Question 16

Without the audit function and GAAP,there would be very little oversight or supervision of corporate accounting practices.

Accepted Answer

A) True 
 B)False

Question 17

A prepaid expense would be classified as

Accepted Answer

A)   an expense.
B)   an unearned revenue.
C)   a liability.
D)   an asset.
E)   cost of goods sold.F) A) and B)
G) A) and E)

Question 18

Pam's Copy Shop is in the process of organizing its assets in the appropriate order.They ask you for help in arranging the following assets: equipment,accounts receivable,cash,merchandise inventory,and notes receivable.You list ____ first and ____ last.

Accepted Answer

A)   merchandise inventory;notes receivable
B)   accounts receivable;equipment
C)   notes receivable;accounts receivable
D)   equipment;accounts receivable
E)   cash;equipmentF) B) and C)
G) C) and D)

Question 19

What ratio is used to measure a firm's ability to pay its current liabilities and what does this ratio tell a manager? How can a low ratio be improved?

Accepted Answer

A firm's current ratio can be used to ev...

Question 20

All of the following are classified as fixed assets except

Accepted Answer

A)   factory equipment.
B)   a company car.
C)   computers held for resale.
D)   property.
E)   buildings.F) A) and B)
G) C) and E)

Exam 15: Using Management and Accounting Information

In 1987,the Securities and Exchange Commission (SEC)and the Financial Accounting Standards Board (FASB)required all publicly traded companies to include a statement of cash flows along with the balance sheet and income statement in their annual report.

Correct AnswerverifiedShow Answer

Cindy provides piano lessons to students in her home four days a week.The money she earns from providing these services would be called ____ on an income statement.

Correct AnswerverifiedShow Answer

The cash that Coca-Cola receives from providing customers with Coke and other soft drinks and juices would appear in the ____ section of the statement of cash flows.

Correct AnswerverifiedShow Answer

The cost of goods sold for Peterson Fashions is $360,000.The beginning inventory for the firm was $20,000.Twelve months later the ending inventory was $40,000.What is the firm's inventory turnover?

Correct AnswerverifiedShow Answer

​What is the average inventory of a business that turns over inventory 10.0 times a year and has a cost of goods sold of $300,000?

Correct AnswerverifiedShow Answer

Debts that are to be repaid in two years are referred to as

Correct AnswerverifiedShow Answer

A prepaid expense would be classified as

Correct AnswerverifiedShow Answer

On a balance sheet,assets are listed in order,from the most liquid to the least liquid.

Correct AnswerverifiedShow Answer

The value of a firm's stock plus any retained earnings that have accumulated to date is referred to as

Correct AnswerverifiedShow Answer

Most data gathered for an MIS come from

Correct AnswerverifiedShow Answer

Pam's Copy Shop is in the process of organizing its assets in the appropriate order.They ask you for help in arranging the following assets: equipment,accounts receivable,cash,merchandise inventory,and notes receivable.You list ____ first and ____ last.

Correct AnswerverifiedShow Answer

The value of goods on hand for sale to customers is called

Correct AnswerverifiedShow Answer

Dividing current assets by current liabilities gives the current ratio.

Correct AnswerverifiedShow Answer

All of the following are classified as fixed assets except

Correct AnswerverifiedShow Answer

The current ratio is calculated by dividing

Correct AnswerverifiedShow Answer

The process of spreading the cost of a fixed asset over the asset's useful life is called

Correct AnswerverifiedShow Answer

What ratio is used to measure a firm's ability to pay its current liabilities and what does this ratio tell a manager? How can a low ratio be improved?

Correct AnswerverifiedA firm's current ratio can be used to ev...View AnswerShow Answer

Without the audit function and GAAP,there would be very little oversight or supervision of corporate accounting practices.

Correct AnswerverifiedShow Answer

How would it be easier to determine if a firm made or lost money last year-by looking at the balance sheet or by looking at the income statement? Support your answer by explaining in general terms what accounts a balance sheet lists and what accounts an income statement lists.

Correct AnswerverifiedThe quickest way to determine if a firm ...View AnswerShow Answer

Cassie has worked for one week but her employer only pays its employees every two weeks.The amount of money her company owes her is classified as

Correct AnswerverifiedShow Answer

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What is the average inventory of a business that turns over inventory 10.0 times a year and has a cost of goods sold of $300,000?

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Pam's Copy Shop is in the process of organizing its assets in the appropriate order.They ask you for help in arranging the following assets: equipment,accounts receivable,cash,merchandise inventory,and notes receivable.You list first and last.

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Correct Answer
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A firm's current ratio can be used to ev...
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The quickest way to determine if a firm ...
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