100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
TEST BANK FOR Financial Accounting for MBAs( 8th Edition)by Easton And John Wild 2024|| WITH CORRECT ANSWERS|| AND RATIONALES $14.49   Add to cart

Exam (elaborations)

TEST BANK FOR Financial Accounting for MBAs( 8th Edition)by Easton And John Wild 2024|| WITH CORRECT ANSWERS|| AND RATIONALES

 16 views  0 purchase
  • Course
  • Financial accounting for MBAs
  • Institution
  • Financial Accounting For MBAs

TEST BANK FOR Financial Accounting for MBAs (8th Edition )by Easton And John Wild 2024|| WITH CORRECT ANSWERS|| AND RATIONALES

Preview 4 out of 203  pages

  • August 4, 2024
  • 203
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers
book image

Book Title:

Author(s):

  • Edition:
  • ISBN:
  • Edition:
  • Financial accounting for MBAs
  • Financial accounting for MBAs
avatar-seller
lauraskyperfect
Test Bank for Financial Accounting
for MBAs 8th Edition by Easton
And John Wild

, Module 1
Financial Accounting for MBAs
Learning Objectives – Coverage by question
True/False Multiple Choice


LO1 – Explain and assess the four main business
activities.



LO2 – Identify and discuss the users and suppliers of
1- 4 1, 2
financial staTement information.


LO3 – Describe and examine the four financial
5-10 3-19
staTements, and define the accounting
equation.

LO4 – Explain and apply the basics of profitability
11-13 20-25
analysis.



LO5 – Assess business operations within the context
14 26, 27
of a competitive environment.


LO6 – Access reports filed with the SEC (Appendix
1A).


LO7 – Describe the accounting principles and
regulations that frame financial staTements 15 28-30
(Appendix1B).


These questions are available to assign in myBusinessCourse.

,Module 1: Financial Accounting for MBAs


True/False

Topic: Users of Financial StaTement
InformationLO: 2
1. Shareholders demand financial information primarily to assess profitability and risk whereas bankers
demand information primarily to assess cash flows to repay loan interest and principal.

Answer: True
Rationale: While both shareholders and bankers are interested in all the information companies
provide, shareholders care about more about a entreprise’s profitability and bankers care more about
solvency and creditworthiness.


Topic: Publicly Available Financial Reports
LO: 2
2. Publicly traded companies are required to provide quarterly financial reports directly to the public.

Answer: False
Rationale: Companies provide electronic versions of quarterly financial staTements to the SEC, which
posts them to the Internet for the public to access them.


Topic: Users of Financial StaTement
InformationLO: 2
3. Publicly traded companies provide financial information primarily to satisfy the SEC and the tax
authorities (that is, the Internal Revenue Service).

Answer: False
Rationale: Demand for information extends to many users; the regulators such as the SEC and the
IRS are only one class of users.


Topic: SEC Filings
LO: 2
4. Publicly traded companies must provide to the Securities Exchange Commission annual audited
financial staTements (10-K reports) and quarterly audited financial staTements (10-Q reports).

Answer: False
Rationale: Quarterly reports do not need to be audited.


Topic: Balance Sheet
LO: 3
5. If a entreprise reports retained earnings of $175.3 million on its balance sheet, it must also report
$175.3 million in cash.

Answer: False
Rationale: The accounting equation requires total assets to equal total liabilities plus stockholders’
equity. That does not imply, however, that liability and equity accounts relate directly to specific
assets.

, Topic: Balance Sheet
LO: 3
6. A balance sheet shows a enterprise’s position over a period of time, whereas an income
staTement,staTement of stockholders’ equity, and staTement of cash flows show its position at a
point in time.

Answer: False
Rationale: The staTement is reversed: A balance sheet shows a enterprise’s position at a point in
time, whereas an income staTement, staTement of equity, and staTement of cash flows show its
positionover a period of time.


Topic: Accounting Equation
LO: 3
7. Assets must always equal liabilities plus equity.

Answer: True
Rationale: The accounting equation is Assets = Liabilities + Equity. This relation must always hold.


Topic: Income
StaTementLO: 3
8. The income staTement reports net income which is defined as the entreprise’s profit after all
expensesand dividends have been paid.

Answer: False
Rationale: The staTement contains two errors. First, net income does not include any dividends
during the period; these are a distribution of profits and not part of its calculation. Second, the income
staTement is prepared on an accrual basis and thus includes expenses incurred (as opposed to paid).


Topic: StaTement of Cash
FlowsLO: 3
9. A staTement of cash flows reports on cash flows for operating, investing and financing activities at
apoint in time.

Answer: False
Rationale: A staTement of cash flows reports on cash flows for operating, investing, and financing
activities over a period of time.


Topic: StaTement of Stockholders’
EquityLO: 3
10. An increase in common stock would be reflected in the staTement of stockholders’ equity.

Answer: True
Rationale: The staTement of stockholders’ equity reports on changes in the accounts that make up
stockholders’ equity. This includes contributed capital, retained earnings, and other equity.

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

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

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

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 lauraskyperfect. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $14.49. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

79271 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling
$14.49
  • (0)
  Add to cart