Accounting Deck

Question 1

Which of the following is NOT one of the primary financial statements?

A Balance Sheet

B Liabilities Statement

C Cash Flows Statement

D Income Statements

Answer 1

B

Question 2

Which of the following financial statements is reported as of a specific date (as opposed to over a period of time)?

A Balance Sheet

B Income Statement

C Retained Earnings Statement

D Cash Flows Statement

Answer 2

A

Question 3

Which of the following is NOT a component of the Cash Flows Statements?

A Operating Cash Flows

B Investing Cash Flows

C Financing Cash Flows

D Production Cash Flows

Answer 3

D

Question 4

Which of the following is correct regarding the Balance Sheet Equation?

A Assets = Liabilities + Shareholders’ Equity

B Assets + Liabilities = Shareholders’ Equity

C Assets = Liabilities – Shareholders’ Equity

D Assets – Liabilities = Shareholders’ Equity

Answer 4

A

Question 5

Which of the following is an example of an ASSET?

A Prepaid Rent

B Retained Earnings

C Accounts Payable

D Common Stock

Answer 5

A

Question 6

Each of the follow is a component of Contributed Capital EXCEPT:

A Preferred Stock

B Additional Paid-In Capital

C Bonds Payable

D Common Stock

Answer 6

C

Question 7

Which statement regarding the differences between Revenues and Gains is correct?

A Revenues are short-term and Gains are long-term

B Revenues are long-term and Gains are short-term

C Revenues relate to core business activities while Gains do not

D Revenues do not relate to core business activities but Gains do

Answer 7

C

Question 8

An increase to non-cash operating assets has what affect on Cash Flows from Operations?

A No effect

B Increase to Cash Flow from Operations

C Decrease to Cash Flow from Operations

D Unable to determine based on the above information

Answer 8

C

Question 9

All of the following are considered Financing Cash Flows EXCEPT:

A Dividend Payment

B Issue Common Stock for Cash

C Pay off existing Debt

D Purchase of Investment Securities

Answer 9

D

Question 10

Of the following accounts, which is likely to be listed first on a Balance Sheet?

A Accounts Receivable

B Common Stock

C Cash

D Accounts Payable

Answer 10

C

Question 11

Which of the following statements correctly identifies when assets are considered “current”?

A It is expected to be received within a year or operating cycle

B It is expected to be used up or converted to cash within a year or operating cycle

C It must be paid within a year or operating cycle

D It was used up within the past year or operating cycle

Answer 11

B

Question 12

Which of the following equations accurately defines operating income?

A Revenues – Expenses + Gains – Losses

B Revenues – Expenses

C Revenues + Gains

D Revenues only

Answer 12

B

Question 13

What is subtracted from Net Income to arrive at the change in Retained Earnings?

A Dividends paid

B Dividends declared

C Dividends payable

D Dividends received

Answer 13

B

Question 14

How is Net Increase (Decrease) in Cash calculated from the Statement of Cash Flows?

A Operating Cash Flows – Investing Cash Flows – Financing Cash Flows

B Operating Cash Flows – Investing Cash Flows + Financing Cash Flows

C Operating Cash Flows + Investing Cash Flows – Financing Cash Flows

D Operating Cash Flows + Investing Cash Flows + Financing Cash Flows

Answer 14

D

Question 15

Which of the following organizations is currently responsible for setting accounting standards in the United States?

A Accounting Principles Board

B Committee on Accounting Procedures

C Financial Accounting Standards Board

D Securities and Exchange Commission

Answer 15

C

Question 16

What is the primary purpose of Accounting Standards Codification by the FASB?

A Organize accounting standards by number rather than topic

B Increase the number of accounting standards

C Decrease the number of accounting standards

D Organize accounting standards by topic rather than number

Answer 16

D

Question 17

International Financial Reporting Standards are currently set by which organization?

A International Accounting Standards Committee

B International Accounting Standards Board

C International Financial Reporting Committee

D International Financial Reporting Board

Answer 17

B

Question 18

Which of the following statements is correct regarding the accounting standards currently use in the United States?

A Companies must use US GAAP

B Companies may use either US GAAP or IFRS

C Companies may use GAAP from any recognized country around the world

D Companies must use IFRS

Answer 18

A

Question 19

How many countries currently permit or require financial reporting under IFRS?

A Approximately 10

B Approximately 50

C Approximately 75

D Over 100

Answer 19

D

Question 20

What is the formula for calculating contribution margin?

A Unit variable cost – unit revenue

B Unit revenue – unit variable cost

C Unit fixed cost – unit variable cost

D Unit revenue – unit fixed cost

Answer 20

B

Question 21

What is the formula for breakeven point?

A Fixed cost/contribution margin

B Variable cost/contribution margin

C Contribution margin/fixed cost

D Contribution margin/variable cost

Answer 21

A

Question 22

A company has total fixed cost of $10,000 and revenues per unit of $16. If the breakeven point is 4,000 units, what is the variable cost per unit?

A $2.50

B $9.00

C $12.25

D $13.50

Answer 22

D

Question 23

ABC Company sells shoes and desires to have a profit of $75,000. If the sale price per pair of shoes is $100, the variable cost per pair of shoes is $30, and the total fixed cost is $315,000, how many pairs of shoes must ABC company sell?

A 3,429 pairs

B 4,500 pairs

C 5,572 pairs

D 8,000 pairs

Answer 23

C

Question 24

If a company can produce multiple products on its production line, which product should it produce first?

A The product with the highest sale price

B The product that the company can produce the most of

C The product with the lowest cost per unit

D The produce with the highest contribution margin per unit of production

Answer 24

D