Deck 1: Introducing Financial Accounting

Question 1

One reason companies are motivated to disclose financial information to external decision makers is that it may lower financing and operating costs.

Answer 1

True

Question 2

All of the following are proper uses of financial accounting information by a company's board of directors except:

A) To review the results of operations
B) To evaluate future strategy
C) To assess management performance
D) To distribute buy/sell recommendations prior to company release of information

Answer 2

To distribute buy/sell recommendations prior to company release of information

Question 3

To the nearest hundredth, what is the 2016 debt-to-equity ratio for The Grocer Company?

A) 2.41
B) 4.92
C) 1.77
D) 44.16

Answer 3

1.77

Question 4

To the nearest hundredth of a percent, what is the return on equity ratio 2016 for FoodValu?

A) 21.48%
B) (61.89)%
C) (152.83)%
D) Not enough information is provided
Answer B

Question 5

Which one of the following is not a quality of relevant accounting information?

A) Timeliness
B) Predictive value
C) Feedback value
D) Understandability

Question 6

Match each of the following terms (1-8) on the left with related explanations (A - H) on the right.

-Partnership

A) Corporations with stock traded on public exchanges
B) The common form of business ownership used by lawyers and CPAs
C) Lenders of resources
D) Designed primarily for decision makers outside of the company
E) Elected by the shareholders to oversee management
F) Owners of a corporation
G) Securities and Exchange Commission
H) Designed primarily for decision makers within the company

Question 7

Match the following decision makers with the most likely decisions they seek to answer from accounting information. Use each answer only onc

-Suppliers and customers

A) Corporations with stock traded on public exchanges
B) The common form of business ownership used by lawyers and CPAs
C) Lenders of resources
D) Designed primarily for decision makers outside of the company
E) Elected by the shareholders to oversee management
F) Owners of a corporation
G) Securities and Exchange Commission
H) Designed primarily for decision makers within the company

Question 8

Match the following decision makers with the most likely decisions they seek to answer from accounting information. Use each answer only onc

-Productions and operations

A) Corporations with stock traded on public exchanges
B) The common form of business ownership used by lawyers and CPAs
C) Lenders of resources
D) Designed primarily for decision makers outside of the company
E) Elected by the shareholders to oversee management
F) Owners of a corporation
G) Securities and Exchange Commission
H) Designed primarily for decision makers within the company

Question 9

Match the following decision makers with the most likely decisions they seek to answer from accounting information. Use each answer only onc

-Top management

A) Corporations with stock traded on public exchanges
B) The common form of business ownership used by lawyers and CPAs
C) Lenders of resources
D) Designed primarily for decision makers outside of the company
E) Elected by the shareholders to oversee management
F) Owners of a corporation
G) Securities and Exchange Commission
H) Designed primarily for decision makers within the company

Question 10

Match the following decision makers with the most likely decisions they seek to answer from accounting information. Use each answer only onc

-Marketing teams

A) Corporations with stock traded on public exchanges
B) The common form of business ownership used by lawyers and CPAs
C) Lenders of resources
D) Designed primarily for decision makers outside of the company
E) Elected by the shareholders to oversee management
F) Owners of a corporation
G) Securities and Exchange Commission
H) Designed primarily for decision makers within the company

Question 11

Match the following decision makers with the most likely decisions they seek to answer from accounting information. Use each answer only onc

-Liabilities

A) (I) for Income Statement
B) (B) for Balance Sheet and
C) (CF) for Statement of Cash Flow.

Question 12

Match the following decision makers with the most likely decisions they seek to answer from accounting information. Use each answer only onc

-Retained earnings

A) (I) for Income Statement
B) (B) for Balance Sheet and
C) (CF) for Statement of Cash Flow.