Chapter 1—Accounting and the Financial Statements
TRUE/FALSE
1. There are more corporations than sole proprietorships and partnerships in the
... [Show More] United States. ANS: F PTS: 1 DIF: Difficulty: Easy
OBJ: LO: 1-1 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-01-Purpose KEY: Bloom's: Knowledge NOT: 1 min.
2. The three main business activities are financing, operating, and investing.
ANS: T PTS: 1 DIF: Difficulty: Easy OBJ: LO: 1-2 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-03-Business Forms KEY: Bloom's: Knowledge NOT: 1 min.
3. Internal users of accounting information include present creditors and management. ANS: F PTS: 1 DIF: Difficulty: Easy
OBJ: LO: 1-1 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-01-Purpose KEY: Bloom's: Knowledge NOT: 1 min.
4. The income statement summarizes the assets, liabilities and stockholders’ equity for a period of time. ANS: F PTS: 1 DIF: Difficulty: Easy
OBJ: LO: 1-3 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-09-Financial Statement KEY: Bloom's: Knowledge NOT: 1 min.
5. The four basic financial statements are the Income Statement, Statement of Retained Earnings, Balance Sheet, and Statement of Cash Flows.
ANS: T PTS: 1 DIF: Difficulty: Easy OBJ: LO: 1-3 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-09-Financial Statement KEY: Bloom's: Knowledge NOT: 1 min.
6. The amount of earnings distributed to stockholders can be found in the income statement as an expense.
ANS: F PTS: 1 DIF: Difficulty: Moderate
OBJ: LO: 1-5 | LO: 1-6 NAT: BUSPROG: Communication STA: AICPA FN-Reporting | ACBSP-APC-09-Financial Statement
KEY: Bloom's: Knowledge NOT: 1 min.
7. Stockholders' equity is composed of two main sources: liabilities and contributed capital.
Financial-Accounting-3rd-Edition-by-Rich
ANS: F PTS: 1 DIF: Difficulty: Easy
REF: CS1-2 OBJ: LO: 1-4 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-09-Financial Statement KEY: Bloom's: Knowledge NOT: 1 min.
8. The first step in preparing the classified balance sheet is to list the assets in order of liquidity. ANS: F PTS: 1 DIF: Difficulty: Moderate
REF: CS1-2 OBJ: LO: 1-4 NAT: BUSPROG: Communication
STA: AICPA FN-Reporting | ACBSP-APC-09-Financial Statement KEY: Bloom's: Knowledge NOT: 1 min.
9. The only financial statement that reports the retained earnings balance at the end of the period is the Statement of Retained Earnings.
ANS: F PTS: 1 DIF: Difficulty: Moderate
OBJ: LO: 1-4 | LO: 1-6 NAT: BUSPROG: Communication STA: AICPA FN-Reporting | ACBSP-APC-09-Financial Statement
KEY: Bloom's: Knowledge NOT: 1 min. [Show Less]