1. An auto repair company is not an example of a manufacturer.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 4-5
LEARNING OBJECTIVES: FACC.PONO.13.01-01 - LO: 01-01
KEYWORDS: Bloom's: Applying
2. A department store is an example of a manufacturer.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
REFERENCES: pp. 4-5
LEARNING OBJECTIVES: FACC.PONO.13.01-01 - LO: 01-01
KEYWORDS: Bloom's: Applying
3. The FASB is an external user that has the authority of the law to obtain certain accounting information.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
REFERENCES: pp. 6-7
LEARNING OBJECTIVES: FACC.PONO.13.01-02 - LO: 01-02
KEYWORDS: Bloom's: Remembering
4. A partnership is a business owned by two or more individuals.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 6-7
LEARNING OBJECTIVES: FACC.PONO.13.01-02 - LO: 01-02
KEYWORDS: Bloom's: Remembering
5. Business entities and non-business entities are both organized to earn a profit.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
REFERENCES: pp. 6-7
LEARNING OBJECTIVES: FACC.PONO.13.01-02 - LO: 01-02
KEYWORDS: Bloom's: Remembering
6. Someone to whom a company has a debt is known as a creditor.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 8-10
LEARNING OBJECTIVES: FACC.PONO.13.01-03 - LO: 01-03
KEYWORDS: Bloom's: Remembering
7. Assets can be tangible or intangible in nature.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 8-10
LEARNING OBJECTIVES: FACC.PONO.13.01-03 - LO: 01-03
KEYWORDS: Bloom's: Remembering
8. An asset is a future economic benefit to a business.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 8-10
LEARNING OBJECTIVES: FACC.PONO.13.01-03 - LO: 01-03
KEYWORDS: Bloom's: Remembering
, Chapter 1: Accounting as a Form of Communication
10. Capital stock indicates the owners’ ownership to a corporation.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 8-10
LEARNING OBJECTIVES: FACC.PONO.13.01-03 - LO: 01-03
KEYWORDS: Bloom's: Remembering
11. Management accounting is the branch of accounting concerned with communication with internal management.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: p. 12
LEARNING OBJECTIVES: FACC.PONO.13.01-04 - LO: 01-04
KEYWORDS: Bloom's: Remembering
12. External users of accounting information include present and potential stockholders, bankers and other creditors, and
management.
a. True
b. False
ANSWER: False
DIFFICULTY: Easy
REFERENCES: pp. 11-12
LEARNING OBJECTIVES: FACC.PONO.13.01-04 - LO: 01-04
KEYWORDS: Bloom's: Remembering
13. Bondholders are external users of company’s accounting information.
a. True
b. False
ANSWER: True
DIFFICULTY: Easy
REFERENCES: pp. 11-12
LEARNING OBJECTIVES: FACC.PONO.13.01-04 - LO: 01-04
KEYWORDS: Bloom's: Remembering
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