Accounting Unit Assessment

What is the primary role of financial accounting?

• to provide internal reports for managment decision - making

• to prepare financial statements for external stakeholders

• to manage cash flow within the organization

• to analyze operational efficiency

Which of the following best describes managerial accounting?

• focused on historical data only

• used primarily for external reporting

• provides information for internal decision - making

• always follows strict regulations like GAAP

What is a key difference between financial and managerial accounting?

• financial accounting is more detailed than managerial accounting

• managerial accounting focuses on future planning, while financial accounting focuses on past performance

• financial accounting is only used by public companies

• managerial accounting must follow GAAP regulations

Which statement is true regarding the cash flow statement?

• it reflects the company's profitability over time

• it shows how cash is generated and used in different activities

• it is the same as income statement

• it lists the company's assets and liabilities

If a company's cash flow from operating activities is negative. What does this typically indicate?

• the company is not generating enough revenue

• the company is investing heavily in new equipment

• the company has paid off all its debts

• the company is experiencing rapid growth

Which of the following best describes net income?

• total revenues minus total expenses

• total assets minus total liabilities

• cash inflows from operating activities

• owner's equity at the end of the period

If a company has total assets of $150,000 and total liabilities of $90,000, what is the owner's equity?

Owner's equity = Assets - liabilities

• $60,000

• $90,000

• $150,000

• $50,000

Which of the following is not a component of the income statement?

• revenues

• cash flow from operations

• expenses

• net income

What is the primary purpose of the balance sheet?

• To summarize a company's cash flow.
• To list all the company's expenses for the year.
• To provide a snapshot of a company's financial position.
• To provide a detailed report of daily transactions.

What is the primary purpose of the Cash Flow Statement?

• To report on the company's revenue and expenses for the year.
• To analyze the company's market share and competition.
• To provide information about the cash inflows and outflows of a company.
• To summarize the company's total assets and liabilities.