Test Bank for Corporate Financial Accounting 13e Carl Warren James M Reeve Jonathan Duchac
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Course
Corporate Financial Accounting
Institution
Corporate Financial Accounting
CHAPTER 03 - THE ADJUSTING PROCESS
1. Even though GAAP requires the accrual basis of accounting, some businesses prefer using the cash basis of accounting.
a. True b. False
ANSWER: DIFFICULTY:
LEARNING OBJECTIVES: ACCREDITING STANDARDS:
True
Moderate
Bloom's: Remembering FNMN.WARD.16.03-01 -...
,CHAPTER 01 - INTRODUCTION TO ACCOUNTING AND BUSINESS
1. A corporation is a business that is legally separate and distinct from its owners.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
Bloom's: Remembering
LEARNING OBJECTIVES: FNMN.WARD.16.01-01 - LO: 01-01
ACCREDITING STANDARDS: ACCT.ACBSP.APC.03 - Business Forms
ACCT.AICPA.BB.01 – Industry
ACCT.AICPA.FN.03 – Measurement
BUSPROG: Analytic
2. The role of accounting is to provide many different users with financial information to make economic decisions.
a. True
b. False
,Chapter 01 - Introduction to Accounting and Business
5. Senior executives cannot be criminally prosecuted for the wrong doings they commit on behalf of the companies
where they work.
a. True
b. False
6. Financial accounting provides information to all users, while the main focus for managerial accounting is to provide
information to the management.
a. True
b. False
8. Some of the major fraudulent acts by senior executives started as what they considered to be small ethical lapses
which grew out of control.
a. True
b. False
, Chapter 01 - Introduction to Accounting and Business
9. A business is an organization in which basic resources or inputs, like materials and labor, are assembled and
processed to provide outputs in the form of goods or services to customers.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
Bloom's: Remembering
LEARNING OBJECTIVES: FNMN.WARD.16.01-01 - LO: 01-01
ACCREDITING STANDARDS: ACCT.ACBSP.APC.03 - Business Forms
ACCT.AICPA.BB.01 – Industry
ACCT.AICPA.BB.06 - Resource Management
BUSPROG: Analytic
10. Two factors that typically lead to ethical violations are relevance and timeliness of accounting information.
a. True
b. False
11. An example of a general-purpose financial statement would be a report about projected price increases related to
transportation costs.
a. True
b. False
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