Question 1

Accounting systems are utilized by companies for several reasons,but they have little value when it comes to making economic decisions.

Accepted Answer

Accounting systems provide important financial information such as revenue, expenses, and profits which are essential in making economic decisions. Therefore, they have value in making economic decisions.

Question 2

Recording financial transactions is an accounting function.

Accepted Answer

Recording financial transactions is the primary function of accounting.

Question 3

The use of computerized accounting systems has greatly reduced the need for private accountants in medium and large-sized firms.

Accepted Answer

While computerized accounting systems have automated many tasks, they have not eliminated the need for private accountants. Accountants are still needed for analysis, decision-making, and ensuring compliance with regulations.

Question 4

Public accountants provide a variety of accounting services for clients on a fee basis.

Accepted Answer

Public accountants offer services such as auditing, tax preparation, and financial planning to clients, and they are compensated through fees charged for these services.

Question 5

Forensic accountants provide standardized reports primarily intended for managers and other decision-makers employed by an organization.

Accepted Answer

Forensic accountants provide detailed reports, usually meant for legal or investigative purposes, which may be utilized by attorneys, law enforcement officials, or regulators. These reports are often used in court proceedings or to support investigations. While managers and decision-makers may certainly benefit from the information contained in forensic accounting reports, they are not generally the primary audience for these documents.

Question 6

The vast majority of firms today use computerized accounting systems and sophisticated software to record and summarize transactions.

Accepted Answer

With the advancements in technology, most firms use computerized accounting systems and software to manage their financial transactions. This allows for better accuracy, efficiency, and organization of financial data.

Question 7

Mary Reardon is an employee and shareholder for the McNeely Company.Mary is considered a primary user of her firm's accounting information.

Accepted Answer

Mary Reardon is an employee of the McNeely Company, which means she is most likely involved in the day-to-day operations of the business and will use accounting information to make decisions related to her job. As a shareholder, she also has a financial stake in the company and will want to stay informed about its financial performance. Therefore, Mary is considered a primary user of her firm's accounting information.

Question 8

Private,internal,and government accountants are business titles used by certified public accountants.

Accepted Answer

Private, internal, and government accountants are not business titles used by certified public accountants.

Question 9

Forensic accountants combine their knowledge of accounting with investigative skills.

Accepted Answer

Forensic accountants use their accounting expertise to examine financial records and statements for evidence of fraudulent activity or other types of financial mismanagement. They also use investigative skills to uncover and analyze relevant information, interview witnesses, and present findings as expert witnesses in legal proceedings.

Question 10

Accountant and bookkeeper are just two terms that refer to the same profession.

Accepted Answer

While there may be some overlap in responsibilities, accountants and bookkeepers have different roles within a business. Accountants often have a degree in accounting and may provide higher-level financial analysis and strategic planning. Bookkeepers typically focus on day-to-day financial recording and may have a certificate in bookkeeping.

Question 11

The accounting profession is seldom concerned with the interpretation of financial information.

Accepted Answer

The accounting profession is very concerned with the interpretation of financial information, as this is necessary for making informed business decisions and assessing a company's financial health.

Question 12

The managers of a company are the only stakeholders of a company that have a legitimate interest in its accounting information.

Accepted Answer

This statement is false. Other stakeholders of a company such as shareholders, creditors, customers, employees, and regulators also have a legitimate interest in its accounting information.

Question 13

Private and public accountants do the same type of work but have different qualifications.

Accepted Answer

Private and public accountants perform different types of work; public accountants provide services such as auditing and tax preparation to a variety of clients, while private accountants work within a single organization managing its financial records. Their qualifications may also differ based on their specific roles and certifications.

Question 14

Key users of a corporation's accounting information include managers,government agencies,and shareholders.

Accepted Answer

This statement is true. Managers use accounting information to make decisions about the company's operations, government agencies use it to ensure compliance with regulations, and shareholders use it to evaluate the company's financial performance.

Question 15

Private accountants work for private citizens who are not part of a firm,while public accountants work internally for publicly traded companies.

Accepted Answer

Private accountants can work for private companies or individuals, while public accountants work for accounting firms that provide services to publicly traded companies or government agencies.

Question 16

Through additional preparation,accountants may become a certified management accountant (CMA),chartered accountant (CA),and/or certified internal auditor.These certifications signify advanced preparation in their field.

Accepted Answer

Additional preparation can lead to certifications such as CMA, CA, and certified internal auditor, which imply advanced knowledge and skills in accounting.

Question 17

Accounting is a system for recognizing,recording,organizing,analyzing,summarizing,and reporting information about the financial transactions that affect an organization.

Accepted Answer

Accounting is indeed a system for recognizing, recording, organizing, analyzing, summarizing, and reporting information about the financial transactions that affect an organization.

Question 18

Internal auditors are also known as chartered accountants.

Accepted Answer

Internal auditors may have a background in accounting, but they are not necessarily chartered accountants. Chartered accountants are a specific type of accountant who have completed a highly-regarded professional qualification.

Question 19

Internal auditors are private accountants responsible for verifying their company's internal accounting procedures.

Accepted Answer

Internal auditors are indeed private accountants who ensure that a company's internal accounting procedures are accurate and effective. They typically work for the company being audited, rather than for an outside organization.

Question 20

Private accountants work within a business organization,preparing reports and analyzing financial information for the company that employs them.

Accepted Answer

Private accountants work within a business organization and provide financial information and analysis exclusively for that organization.

Quiz 7: Accounting: Decision Making by the Numbers