Exam (elaborations)

Test Bank For Accounting Principles 14th Edition by Jerry J. Weygandt, Paul D. Kimmel

0 purchase

Course
Accounting Principles 14th Edition

Institution
Accounting Principles 14th Edition

Book
Accounting Principles

Test Bank For Accounting Principles 14th Edition by Jerry J. Weygandt, Paul D. Kimmel. Chapter 1: Accounting in Action Chapter 2: The Recording Process Chapter 3: Adjusting the Accounts Chapter 4: Completing the Accounting Cycle Chapter 5: Accounting for Merchandising Operations (Perpetual Appr...

[Show more]

Preview 4 out of 1934 pages

View example

Uploaded on April 8, 2024
Number of pages 1934
Written in 2024/2025
Type Exam (elaborations)
Contains Questions & answers

test bank for accounting principles 14th edition
jerry j weygandt paul d kimmel

Institution Accounting Principles 14th Edition
Course Accounting Principles 14th Edition

MedSolutions Member since 1 year 283 documents sold

$19.99

Add to cart

Add to wishlist

100% satisfaction guarantee
Immediately available after payment
Both online and in PDF
No strings attached

sdfghjklkjhgfdsfghjkiyutrertyuiouytrertyiyutrdfghjkkjhgfdfgjkjhgfdfghjkkjhgfdghjkhgf
d

Test Bank for Accounting Principles 14th Edition by
Jerry J. Weygandt, Paul D. Kimmel

CHAPTER 1: ACCOUNTING IN ACTION

CHAPTER LEARNING OBJECTIVES
1. Identify the activities and users associated with accounting. Accounting is an information
system that identifies, records, and communicates the economic events of an organization to
interested users. The major users and uses of accounting are as follows: (a) Management
uses accounting information to plan, organize, and run the business. (b) Investors (owners)
decide whether to buy, hold, or sell their financial interests on the basis of accounting data. (c)
Creditors (suppliers and bankers) evaluate the risks of granting credit or lending money on
the basis of accounting information. Other groups that use accounting information are taxing
authorities, regulatory agencies, customers, and labor unions.
2. Explain the building blocks of accounting: ethics, principles, and assumptions. Ethics
are the standards of conduct by which actions are judged as right or wrong. Effective financial
reporting depends on sound ethical behavior.
Generally accepted accounting principles are a common set of standards used by
accountants. The primary accounting standard-setting body in the United States is the
Financial Accounting Standards Board.

3. State the accounting equation, and define its components. The basic accounting
equation is:
Assets = Liabilities + Owner's Equity
Assets are resources a business owns. Liabilities are creditorship claims on total assets.
Owner's equity is the ownership claim on total assets.
The expanded accounting equation is:
Assets = Liabilities + Owner's Capital − Owner's Drawings + Revenues −
Expenses
Investments by owners (assets the owner puts into the business) are recorded in a category
called owner‘s capital. Owner‘s drawings are the withdrawal of assets by the owner for
personal use. Revenues are the gross increase in owner‘s equity from business activities for
the purpose of earning income. Expenses are the costs of assets consumed or services used
in the process of earning revenue. Owner‘s equity is increased by an owner‘s investments
and by revenues from business operations. Owner‘s equity is decreased by an owner‘s
withdrawals of assets and by expenses.
4. Analyze the effects of business transactions on the accounting equation. Each business
transaction must have a dual effect on the accounting equation. For example, if an individual
asset increases, there must be a corresponding (1) decrease in another asset, or (2) increase
in a specific liability, or (3) increase in owner's equity.
5. Describe the four financial statements and how they are prepared. An income statement
presents the revenues and expenses, and resulting net income or net loss for a specific
period of time. An owner's equity statement summarizes the changes in owner's equity for a
specific period of time. A balance sheet reports the assets, liabilities, and owner's equity at a
specific date. A statement of cash flows summarizes information about the cash inflows
(receipts) and outflows (payments) for a specific period of time.

,6. Explain the career opportunities in accounting. Accounting offers many different jobs in
a

fields such as public and private accounting, governmental, and forensic accounting.
Accounting is a popular major because there are many different types of jobs, with unlimited
potential for career advancement.

, sdfghjklkjhgfdsfghjkiyutrertyuiouytrertyiyutrdfghjkkjhgfdfgjkjhgfdfghjkkjhgfdghjkhgf
d

TRUE-FALSE STATEMENTS
1. Owners of business firms are the only people who need accounting information.

Ans: F, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Reporting, AICPA PC: None, IMA:
Reporting

2. Transactions that can be measured in dollars and cents are recorded in the financial
information system.

Ans: T, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

3. The hiring of a new company president is an economic event recorded by the financial
information system.

Ans: F, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

4. Management of a business enterprise is the major external user of information.

Ans: F, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

5. Accounting communicates financial information about a business enterprise to both
internal and external users.

Ans: T, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

6. Accounting information is used only by external users with a financial interest in a
business enterprise.

Ans: F, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

7. Financial statements are the major means of communicating accounting information to
interested parties.

Ans: T, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

8. Bookkeeping and accounting are one and the same because the bookkeeping function
includes the accounting process.

Ans: F, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

9. The origins of accounting are attributed to Luca Pacioli, a famous mathematician.

Ans: T, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

, 10. The study of accounting is not useful for a business career unless your career objective is
to become an accountant.

Ans: F, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

11. A working knowledge of accounting is not relevant to a lawyer or an architect.

Ans: F, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

12. Identifying is the process of keeping a chronological diary of events measured in dollars
and cents.

Ans: F, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

13. Management consulting includes examining the financial statements of companies and
expressing an opinion as to the fairness of their presentation.

Ans: F, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

14. A partnership must have more than one owner.

Ans: T, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Governance Perspective, AICPA FC: Measurement Analysis and
Interpretation, AICPA PC: None, IMA: Reporting

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller MedSolutions. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $19.99. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

69052 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 15 years now

Start selling

Exam (elaborations)

Test Bank For Accounting Principles 14th Edition by Jerry J. Weygandt, Paul D. Kimmel

Document information

Subjects

Connected book

More summaries for

Written for

Seller

Reviews received

Content preview