FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 17: Understanding Accounting and Financial Information

Show Answer

Share

---

All types

Filters

Study Flashcards

Question 31

Multiple Choice

Review LaterAdd Note

Review Later

Jim works in the accounting department at the Kansas Sunflower Corporation, where it is his job to record all transactions into journals. After completing this task, the next step in the accounting process is to:

A) prepare the firm's financial statements.
B) post the information to the ledger.
C) determine the tax liability of the firm.
D) balance the difference between assets and liabilities.

E) B) and D)
F) B) and C)

Correct Answer

verified

Show Answer

Question 32

Multiple Choice

Review LaterAdd Note

Review Later

Keith will graduate from Southern State University this year. He has accumulated $18,000 in student loans during his four years at college. An accountant would classify the loans as:

A) assets.
B) liabilities.
C) owners' equity.
D) intangibles.

E) B) and D)
F) A) and B)

Correct Answer

verified

Show Answer

Question 33

True/False

Review LaterAdd Note

Liabilities are reported on the income statement.

Rapidly growing companies often buy increasing amounts of merchandise from suppliers on credit, and then sell the goods to their customers on credit. These companies sometimes have difficulty repaying their suppliers when customers who buy on credit don't pay on time. Firms that experience this difficulty need to do a better job of:

Explain the meaning of the fundamental accounting equation and its relation to the balance sheet. If it is helpful, create an example using numbers.

The cost of goods sold reflects the selling price of the merchandise sold over a period of time.

In order to understand if the results of ratio calculations indicate a financially strong company, the results:

Peak Performance Sporting Goods Company has reported net income after taxes = $3,750,000, with 18,250,000 shares outstanding. Basic Earning per Share for Peak Performance = _________.

Brianna is a bookkeeper for Monograms, Limited. She takes the firm's transactions and records them in a record book or computer program referred to as:

The sole purpose of accounting is to help managers evaluate the financial condition of the firm so that they may make better pricing decisions.

Resources that a firm owns are called:

A(n) __________ provides accounting services to individuals or firms on a fee basis.

The basic earnings per share and the diluted earnings per share would have quite different values for a firm that relied heavily on preferred stock and convertible debt securities to acquire funds.

The reports and financial statements prepared by accountants:

What is the difference between a journal and a ledger? How are journals and ledgers incorporated into the accounting cycle?

__________ is the accounting practice of recording each transaction in two places in the accounting journal.

Net income before taxes is found by deducting total operating expenses from gross profit.

Managers who are concerned about keeping costs under control should be very interested in the information and advice provided by their company's managerial accountants.

What is ratio analysis? Explain the four different types of ratios and how each is used.

Nebraska Communications is considering the purchase of a new satellite. The firm believes the satellite will help generate future earnings. In addition, the firm recognizes the tax benefits of a lower net income provided by the annual ________ of the asset.