TEST BANK For Financial Accounting, 6th Edition By David Spiceland, Wayne Thomas, Verified Chapters 1 - 12, Complete Newest Version TEST BANK For Financial Accounting, 6th Edition By David Spiceland, Wayne Thomas, Verified Chapters 1 - 12, Complete Newest Version TEST BANK For Financial Accounting,...
,Chapter 1 A Framework for Financial Accounting
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1) Accounting is a system of maintaining records of a company's operations and communica
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tingthat information to decision makers.
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Answer: TRUE XC XC
Difficulty: 1 Easy XC XC
Topic: Defining Accounting
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Learning Objective: 01- XC X C
01 Describe the two primary functions of financial accounting.Bloom's: Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinkin
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2) Accounting information is used by investors to decide whether to invest in a company's sto
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ck.
Answer: TRUE XC XC
Difficulty: 1 Easy XC XC
Topic: Defining Accounting
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Learning Objective: 01- XC X C
01 Describe the two primary functions of financial accounting.Bloom's: Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinkin
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3) Accounting information is used by creditors to decide whether to invest in a company's stoc
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k.
Answer: FALSE X C
Explanation: Creditors lend money to a company.
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Difficulty: 1 Easy XC XC
Topic: Defining Accounting
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Learning Objective: 01- XC X C
01 Describe the two primary functions of financial accounting.Bloom's: Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinkin
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4) The primary functions of financial accounting are to measure business activities of a com
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panyand to communicate those measurements to internal parties for decision-
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making purposes. XC
Answer: FALSE X C
Explanation: Financial accounting primarily serves to provide information to external partie
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s.Difficulty: 2 Medium
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Topic: Defining Accounting
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, Learning Objective: 01-
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01 Describe the two primary functions of financial accounting.Bloom's: Understand
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinkin
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