Final Exam

Question 1

3 sections of an audit report

Answer 1

1. Opinion
2. Basis of an Opinion
3. Critical Audit Matters

Question 2

What are the two primary purposes of internal controls

Answer 2

1. Protect and safeguard company asset’s
2. Ensure accurate and reliable information

Question 3

Accounting concept the requires every business be counted separate from it’s owner or owner’s

Answer 3

Business Entity assumptions

Question 4

3 opinions of an audit report

Answer 4

Qualified, unqualified, and adverse

Question 5

What is net income transferred to before going to balance sheet

Answer 5

Retained Earnings

Question 6

Cumulative net income not distributed as dividends to it’s stockholders

Answer 6

Retained Earnings

Question 7

What is the primary purpose of financial accounting

Answer 7

Provide accurate information to external users for informed decisions

Question 8

Fixed costs per unit of output decreases as volume increases

Answer 8

True

Question 9

Difference between standard cost and actual cost

Answer 9

Cost variance

Question 10

What is an example of a conversion cost

Answer 10

Overhead

Question 11

What is an example of a primary cost

Answer 11

Direct material

Question 12

What is conversion costs equal to

Answer 12

Direct Labor - factory overhead