Exam (elaborations)
Financial Accounting Fundamentals Wild 7th Edition- Test Bank
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- Financial Accounting
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- Financial Accounting
Financial Accounting Fundamentals Wild 7th Edition- Test Bank
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,Financial Accounting Fundamentals, 7e (Wild)Chapter 1 Accounting in Business
1) Accounting is an information and measurement system that identifies, records, and
communicates an organization's business activities.
Answer: TRUE
Difficulty: 1 Easy
Topic: Importance of Accounting
Learning Objective: 01-C1 Explain the purpose and importance of accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
2) Recordkeeping, or bookkeeping, is the recording of transactions and events, either manually
or electronically. This is just one part of accounting.
Answer: TRUE
Difficulty: 1 Easy
Topic: Importance of Accounting
Learning Objective: 01-C1 Explain the purpose and importance of accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
3) An accounting system captures relevant data about transactions and then classifies, records,
and reports data.
Answer: TRUE
Difficulty: 1 Easy
Topic: Importance of Accounting
Learning Objective: 01-C1 Explain the purpose and importance of accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
4) Financial accounting is the area of accounting aimed at serving external users by providing
them with general-purpose financial statements.
Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
1
Copyright © 2019 McGraw-Hill Education. All rights reserved.
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
,5) Internal users of accounting information do not directly run the organization and have limited
access to its accounting information.
Answer: FALSE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
6) Auditors verify the effectiveness of internal controls.
Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
7) External auditors examine financial statements to verify that they are prepared according to
generally accepted accounting principles.
Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
8) External users include lenders, shareholders, customers, and regulators.
Answer: TRUE
Difficulty: 2 Medium
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Understand
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
2
Copyright © 2019 McGraw-Hill Education. All rights reserved.
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
, 9) Regulators often have legal authority over certain activities of organizations.
Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Legal; FN Decision Making
10) Internal users include lenders, shareholders, brokers and nonexecutive employees.
Answer: FALSE
Difficulty: 2 Medium
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Understand
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
11) Opportunities in accounting include auditing, consulting, market research, and tax planning.
Answer: TRUE
Difficulty: 2 Medium
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Understand
AACSB/Accessibility: Communication/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
12) Ethics is defined as maximizing personal wealth, regardless the cost.
Answer: FALSE
Difficulty: 2 Medium
Topic: Ethics
Learning Objective: 01-C3 Explain why ethics are crucial to accounting.
Bloom's: Understand
AACSB/Accessibility: Ethics/Keyboard Navigation
AICPA: BB Industry; FN Decision Making
3
Copyright © 2019 McGraw-Hill Education. All rights reserved.
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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