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Accounting MCGRAW Hill Exam 1 Questions with Verified Answers
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Accounting MCGRAW Hill Exam 1 Questions with Verified Answers
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Accounting MCGRAW Hill Exam 1Questions with Verified Answers
True or False: Management Accounting Information is oriented toward the future while
financial accounting information is historical in nature. - Answer-True
True or False: The tailoring of an accounting report to meet the needs of a specific
decision maker is more characteristic of financial accounting reports than of
management accounting reports. - Answer-False
True or False: Management accounting refers to the preparation and use of accounting
information designed to meet the needs of decision makers outside the business
organization. - Answer-False
True or False: The content of management accounting reports needs to be presented in
conformity with generally accepted accounting principles. - Answer-False
True or False: One purpose of generally accepted accounting principles is to make
accounting information prepared by different companies more comparable. - Answer-
True
The information systems of most business organizations:
1)Are tailored to meet the organization's needs for accounting information and the
resources available for operating the system.
2)Are similar in design to the journals, ledgers, and worksheets illustrated in this text.
3)Utilize data bases, rather than ledger accounts
4)Are designed by the certified public accountant (CPA) firm that performs the annual
financial audit. - Answer-Are tailored to meet the organization's needs for accounting
information and the resources available for operating the system.
The objectives of an accounting system include all of the following, except:
1) Interpret and record the effects of business transactions
2) Classify the effects of transactions to facilitate the preparation of reports
3) Summarize and communicate information to decision makers
4) Dictate the specific types of business transactions the enterprise may pursue -
Answer-Dictate the specific types of business transactions the enterprise may pursue
Which financial statement is prepared as of a specific date?
, 1) The balance sheet
2) The income statement
3) The statement of cash flows
4)The balance sheet, income statement, and statement of cash flows are all for a period
of time rather than at a specific date - Answer-The balance sheet
In comparison with a financial statement prepared in conformity with generally accepted
accounting principles, a management accounting report is more likely to:
1) Be used by decision makers outside of the business organization
2) Focus upon the operation results of the most recently completed accounting period
3) View the entire organization as the reporting entity.
4) Be tailored to the specific needs of an individual decision maker. - Answer-Be tailored
to the specific needs of an individual decision maker
Which financial statement is primarily concerned with reporting the financial position of a
business at a particular time?
1) The balance sheet.
2) The income statement.
3) The statement of cash flows.
4) Consolidated statement of stockholders' equity. - Answer-The balance sheet
Financial statements are prepared:
1) Only for publicly owned business organizations.
2) For corporations, but not for sole proprietorships or partnerships
3) Primarily for the benefit of persons outside of the business organization.
4) In either monetary or nonmonetary terms, depending upon the need of the decision
maker. - Answer-Primarily for the benefit of persons outside of the business
organization.
Financial statements may be prepared for which time period?
1) One year.
2) Less than one year.
3) More than one vear.
4) Any time period. - Answer-Any time period
Although accounting information is used by a wide variety of external parties, financial
reporting is primarily directed toward the informational needs of:
1) Investors and creditors.
2) Government agencies such as the Internal Revenue Service
4) Customers
5) Trade associations and labor unions - Answer-Investors and Creditors
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