Question 1 Which of the following is not an objective of


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Feb 28, 2015. Question 1 Which of the following is not an objective of financial reporting? Financial reporting should provide information that is useful to present and potential investors and creditors and other users in making rational investment, credit, and similar decisions. Financial reporting should provide information to help present and potential investors and creditors and other users in assessing the amounts, timing, and uncertainty of prospective cash receipts from dividends or interest and the proceeds from the sale, redemption, or maturity of securities or loans. Financial reporting should provide information about the economic resources of an enterprise, the claims against those resources, and the effects of transactions, events, and circumstances that change the resources and claims against those resources. Financial accounting is designed to measure directly the value of a business enterprise. 1.5 points Question 2 The primary current source of generally accepted accounting principles for non government operations is the New York Stock Exchange Financial Accounting Standards Board Securities and Exchange Commission American Institute of Certified Public Accountants 1.5 points Question 3 Which of the following indicates how revenue is usually recognized? Point of sale End of production Receipt of cash During production 1.5 points Question 4 Statement of Financial Accounting Concepts No. 1, “ Objectives of Financial Reporting by Business Enterprises,” includes all of the following objectives, except one. Which objective does it not include? Financial accounting is designed to measure directly the value of a business enterprise. Investors, creditors, and others may use reported earnings and information about the elements of financial statements in various ways to assess the prospects for cash flows. The primary focus of financial reporting is information about earnings and its components. The primary focus of financial reporting is information about earnings and its components. 1.5 points Question 5 If assets are $ 40,000 and stockholders’ equity is $ 10,000, how much are liabilities? $50,000 $10,000 $30,000 $20,000 1.5 points Question 6 From the point of view of analysis, which classification of an audit opinion indicates that the financial statements carry the highest degree of reliability? disclaimer of opinion Unqualified opinion qualified opinion adverse opinion 1.5 points Question 7 Which of these is not a suggested problem caused by lack of harmonization of international accounting standards? Difficulties in reconciling local standards for access to other capital markets Difficulties in reconciling local standards for access to other capital markets A need for employment of key personnel in multinational companies to bridge the “ gap” in accounting requirements between countries Positive effect on the international trade of accounting practice and services 1.5 points Question 8 Which party has the primary responsibility for the financial statements? Bookkeeper Auditor Management Cost accountant 1.5 points Question 9 Current assets typically include all but which of the following assets? Cash restricted for the retirement of bonds Unrestricted cash Marketable securities Inventories 1.5 points Question 10 Which of the following accounts would not be classified as an intangible? Goodwill Patent Accounts Receivable Trademarks 1.5 points Question 11 Growth Company had total assets of $ 100,000 and total liabilities of $ 60,000. What is the balance of the stockholders’ equity? $ 0 $ 40,000 $ 60,000 $ 100,000 1.5 points Question 12 The Current Assets section of the balance sheet should include Inventory Taxes Payable Land Patents 1.5 points Question 13 Which of the following is not a typical current liability? Accounts payable Bonds Payable Interest payable Wages payable 1.5 points Question 14 Which of the following would be classified as an extraordinary…

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