Finance

Chapter 01

1. Communication consists of keeping a systematic, chronological diary of events, measured in dollars and cents.

A. True B. False

2. Financial accounting provides internal reports to help users make decisions about their companies.

A. True B. False

3. The first step in analyzing ethics cases is to recognize an ethical situation and the ethical issues involved.

A.True B. False

4. The cost principle dictates that companies record assets at their cost.

A.True B.False

5. The economic entity assumption applies to corporations but not proprietorships or partnerships.

A. True B.False

6. Expenses are decreases in owner's equity that result from operating the business.

A. True B. False

7. The receipt of cash on account will increase total assets.

A.True B.False

8. A balance sheet is prepared as of a specific date.

A.True B.False

9. The statement of cash flows provides information on the cash receipts and payments for a specific period of time.

A. True B.False

10. Cost accounting is an activity in public accounting.

A. True B.False

11. The first activity of the accounting process is

A. communication. B. identification. C. processing. D. recording.

12. Keeping a systematic, chronological diary of events, measured in dollars and cents is called:

A. communicating. B. identifying. C. processing. D. recording

13. Internal users of accounting information include all of the following except:

A. company officers. B. investors. C. marketing managers. D. production supervisors.

14. Bookkeeping, as opposed to accounting, usually involves only:

A. identifying. B. recording. C. communicating. D. reporting.

15. Ethics are the standards of conduct by which one's actions are judged as:

A. right or wrong. B .honest or dishonest. C. fair or not fair.

D. all of these options.

16. The primary accounting standard-setting body in the United States is the

A. Financial...