Accounting Quiz

Accounting is an information and measurement system that does all of the following except:

• Identifies business activities.

• Records business activities.

• Communicates business activities.

• Does not use technology to improve accuracy in reporting.

• Helps people make better decisions.

The group that attempts to create more harmony among the accounting practices of different countries is the:

• AICPA.

• IASB.

• CAP.

• SEC.

• FASB.

All of the following are True regarding ethics except:

• Ethics are beliefs that separate right from wrong.

• Ethics rules are often set for CPAs.

• Ethics do not affect the operations or outcome of a company.

• Are critical in accounting.

• Ethics can be hard to apply.

External users of accounting information include all of the following except:

• Shareholders.

• Customers.

• Purchasing managers.

• Government regulators.

• Creditors.

Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported?

• Going-concern assumption.

• Matching principle.

• Cost principle.

• Business entity assumption.

• Consideration assumption.

Assets created by selling goods and services on credit are:

• Accounts payable.

• Accounts receivable.

• Liabilities.

• Expenses.

• Equity.

The accounting assumption that requires every business to be accounted for separately from other business entities, including its owner or owners is known as the:

• Time-period assumption.

• Business entity assumption.

• Going-concern assumption.

• Revenue recognition principle.

• Cost principle.

Resources that are expected to yield future benefits are:

• Assets.

• Revenues.

• Liabilities.

• Owner's Equity.

• Expenses.

Creditors' claims on the assets of a company are called:

• Net losses.

• Expenses.

• Revenues.

• Equity.

• Liabilities.

If assets are $99,000 and liabilities are $32,000, then equity equals:

• $32,000.

• $67,000.

• $99,000.

• $131,000.

• $198,000.