Chapter 8 Accounting Review

What is a system for recognizing, organizing, analyzing, and reporting information about the financial transactions that affect an organization?

• Auditing

• Marketing

• Management

• Accounting

Who are the key users of accounting information?

• Managers, Stockholders, Employees, Creditors, Suppliers, Government

• Customers, Competitors, Media, Public

• Only Managers and Employees

• Only Stockholders and Creditors

What are three types of roles accountants fill?

• Public accountant, Management accountant, Government accountant

• Financial analyst, Marketing manager, Sales executive

• HR manager, IT specialist, Operations manager

• Legal advisor, Compliance officer, Risk manager

What are the requirements to become a (CPA) Certified public accountant in most states?

• 50 semester hours, pass a four-part test

• 100 semester hours, pass a two-part test, two years of experience

• 200 semester hours, pass a three-part test, no experience required

• 150 semester hours, pass a four-part test, one year of experience

What is the branch of accounting that prepares financial statements for use by owners, creditors, suppliers, and other external stakeholders?

• Managerial accounting

• Financial accounting

• Tax accounting

• Cost accounting

What is a set of accounting standards that is used in the preparation of financial statements?

• Generally accepted accounting principles (GAAP)

• International Financial Reporting Standards (IFRS)

• Financial Accounting Standards Board (FASB)

• Certified Public Accountant (CPA)

What is the private board that establishes the generally accepted accounting principles used in the practice of accounting?

• Financial Accounting Standards Board (FASB)

• International Accounting Standards Board (IASB)

• American Institute of CPAs (AICPA)

• Securities and Exchange Commission (SEC)

Through GAAP, what does the FASB aim to ensure that financial statements are?

• Detailed, Concise, Flexible, Secure

• Accurate, Timely, Comprehensive, Understandable

• Relevant, Reliable, Consistent, Comparable

• Innovative, Strategic, Dynamic, Efficient

What is the financial statement that reports the financial position of a firm by identifying and reporting the value of the firm’s assets, liabilities, and owners equity?

• Statement of Retained Earnings

• Income Statement

• Cash Flow Statement

• Balance Sheet

What is the accounting equation?

• Assets = Liabilities - Owners Equity

• Assets = Revenue - Expenses

• Assets = Liabilities + Owners Equity

• Assets = Income + Expenses