Question 1

___________ is to allow the owner, investors, creditors and others with an interest to know the appropriate book worth of the business at a particular date.

Accepted Answer

The balance sheet shows the assets, liabilities, and equity of a company at a particular point in time, providing insight into the book worth of the business. The income statement shows the company's revenue and expenses over a period of time and is used to calculate profitability, but it does not specifically provide book worth information. Financial records and equity are too broad to specifically address the question.

Question 2

Occupational fraud and abuse is a (an) __________ of doing business, in much the same way that we pay expenses for electricity, taxes and wages.

Accepted Answer

Occupational fraud and abuse is a cost of doing business, similar to expenses for electricity, taxes, and wages. Therefore, it is considered an expense.

Question 3

____________ is a summary of the account balances carried in a ledger.

Accepted Answer

The answer of ____________ is a summary of the account...

Question 4

________ increase assets and expenses and/or decrease liabilities and/or equity

Accepted Answer

Debits increase assets and expenses and decrease liabilities and equity in accounting.

Question 5

__________ are the amounts which are owned to other entities:

Accepted Answer

Liabilities are the amounts that an entity owes to other parties, such as loans or outstanding bills. Supplies, expenses, and assets all refer to different types of items or costs that a business may have, but they do not necessarily indicate an amount owed.

Question 6

According to Marshall, ______ are probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.

Accepted Answer

Marshall's definition of assets is "probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events". Therefore, the correct choice is (A) Assets. (B) Liabilities refer to present obligations of an entity, while (C) Credentials are qualifications or achievements of individuals, and (D) None of above is not a viable option.

Question 7

_________ normally are carried on an organization's books as expenses because they tend to be consumed by the organization within a year of purchase.

Accepted Answer

Supplies are items that are used up within a year of purchase and are therefore carried on the organization's books as expenses. Expenses refer to any item that reduces the revenue or increases the cost of generating revenue, while assets are resources that are expected to provide economic benefits to an organization over a period of time, usually more than one year. Equity refers to the residual interest in the assets of an organization after deducting liabilities.

Question 8

Asset misappropriations have an effect on the liabilities and do also have an indirect effect on the equity account.

Accepted Answer

The answer of Asset misappropriations have an effect on the...

Question 9

Which of the following are not of Basic types of non-sharable problems?

Accepted Answer

Larceny by Fraud is a type of crime, not a non-sharable problem. Non-sharable problems typically refer to personal or professional issues that individuals feel they cannot share with others.

Question 10

_____________ involves purposeful misreporting of financial information about the organization that is intended to mislead those who read it.

Accepted Answer

Fraudulent statement involves purposeful misreporting of financial information about the organization that is intended to mislead those who read it. Corruption refers to the abuse of power for personal gain, while asset misappropriations involve stealing or misusing company assets for personal gain.

Question 11

Asset misappropriation schemes were the "middle children" of the study; they were more common than fraudulent statements and more costly than corruption.

Accepted Answer

The answer of Asset misappropriation schemes were the "middle children"...

Question 12

A tangible asset is one which is:

Accepted Answer

A tangible asset is one that can be physically touched or felt and has a measurable value. Therefore, it must be capable of being perceived (option A) and appraised (option B).

Question 13

When expenses used to produce income- all of them- should be matched in a consistent manner against that income, this is referred to:

Accepted Answer

Accrual basis accounting is the method of accounting where expenses are matched with the revenue they generate, regardless of when actually paid or received. This ensures a consistent and accurate representation of a company's financial performance. The other options (Equity, Expense, Financial record) are not directly related to this concept.

Question 14

Depreciation is especially applicable when companies try to overvalue their assets and net worth; the lower their depreciation expense, the higher the company's profits.

Accepted Answer

This statement is true. By decreasing the depreciation expense, a company can increase their net income and inflate their profits, leading to an overvaluation of their assets and net worth.

Question 15

____________ is a process by which a bookkeeper records all transactions and can adjust the books.

Accepted Answer

Journal entries are the records of all transactions made by a bookkeeper, which can be adjusted as needed.

Question 16

Assets that are long-lived and that differ from property, plant and equipment hat has been purchased outright or acquired under a capital lease are:

Accepted Answer

Intangible assets are long-lived assets that do not have a physical form and are not property, plant, or equipment acquired under capital lease. They include items such as patents, copyrights, trademarks, and goodwill.

Question 17

Any expenses that are incurred but not paid by the end of the year are counted in our records of profit and loss, are called:

Accepted Answer

Expenses that are incurred but not paid by the end of the year are called accruals. Accruals are recorded as liabilities on the balance sheet and as expenses on the income statement, so they affect both the company's financial position and its profitability.

Question 18

________ decrease assets and expenses and/or increase liabilities and/or equity

Accepted Answer

Credits decrease assets and expenses and increase liabilities and equity in accounting.

Question 19

The heart of book keeping system is the ___________.

Accepted Answer

The answer of The heart of book keeping system is...

Question 20

The difference between assets and liabilities is called:

Accepted Answer

The difference between assets and liabilities is called equity, which represents the net worth of a company. It is calculated as follows: Equity = Assets - Liabilities.

Exam 1: Certified Fraud Examiner