Question 1

Cash, marketable securities, notes receivable, and merchandise inventory are examples of
A)current assets.
B)expenses.
C)acid-test assets.
D)fixed assets.
E)overhead costs.

Accepted Answer

Cash, marketable securities, notes receivable, and merchandise inventory are all examples of current assets, which are expected to be converted to cash or used up within one year or one operating cycle, whichever is longer.

Question 2

Jessica has worked for one week but her employer only pays its employees every two weeks. The amount of money her company owes her is classified as
A)accounts notable.
B)accounts receivable.
C)notes payable.
D)prepaid wages.
E)salaries payable.

Accepted Answer

Jessica's earned wages that her company has not yet paid her are classified as salaries payable. This is a liability on the company's balance sheet until they pay her on the next pay period. Accounts Noticeable, accounts receivable, and notes payable are all different types of balances that appear on a company's balance sheet but do not apply to this situation. Prepaid wages refer to an expense that a company has already paid in advance, which also doesn't fit this scenario.

Question 3

Merchandise that has been sold and is returned to the firm by the customer is called
A)a sales discount.
B)an expense.
C)a sales allowance.
D)cost of goods sold.
E)a sales return.

Accepted Answer

A merchandise returned by the customer is known as a sales return.

Question 4

The cash at the end of the year reported on the statement of cash flows is the same as the
A)cash amount reported on the firm's balance sheet.
B)cash amount reported on the firm's income statement.
C)net income reported on the firm's income statement.
D)owners' equity amount reported on the firm's balance sheet.
E)total amount of assets reported on the firm's balance sheet.

Accepted Answer

The cash amount reported on the balance sheet is the ending balance of cash for the year, which is also reported on the statement of cash flows. The income statement reports the net income for the year, but this amount does not necessarily correlate to the ending cash balance. The owners' equity and total assets reported on the balance sheet are not directly related to the ending cash balance.

Question 5

A low inventory turnover can be improved by ordering merchandise in smaller quantities at more frequent intervals.

Accepted Answer

Ordering merchandise in smaller, more frequent intervals can help match inventory levels more closely with sales patterns, reducing excess stock and potentially improving inventory turnover by selling through inventory more quickly.

Question 6

The ratio obtained by dividing net income after taxes by net sales is the
A)return on sales ratio.
B)acid-test ratio.
C)return on equity ratio.
D)earnings per share.
E)working capital.

Accepted Answer

The ratio obtained by dividing net income after taxes by net sales is known as the return on sales ratio. It measures the efficiency of a company in generating profits from its sales.

Question 7

Which of the following statements is false?
A)It is possible to compare one firm's accounting data with another firm's accounting data as long as both firms used generally accepted accounting procedures.
B)Many managers compare the financial results from one accounting period with the results from previous accounting periods.
C)Most corporations include in their annual reports comparisons of important elements of their financial statements for recent years.
D)The format and information contained in one firm's financial statements are most likely to differ drastically from the format and information contained in another firm's financial statements.
E)Many firms compare their financial results with industry averages.

Accepted Answer

The statement D is false because while there may be minor differences in presentation, the format and information in financial statements are generally consistent across firms due to the adherence to accounting standards such as GAAP (Generally Accepted Accounting Principles) or IFRS (International Financial Reporting Standards). These standards ensure that financial statements are somewhat uniform and comparable across different firms.

Question 8

Commonly used in accounting analysis, a ____ shows a relationship between two elements of a firm's financial statements.
A)statistic
B)comparative number
C)current ratio
D)financial ratio
E)formula

Accepted Answer

A financial ratio shows the relationship between two elements of a firm's financial statements, such as the current ratio, debt-to-equity ratio, or return on assets ratio. Statistic, comparative number, and formula are all too general and do not specifically relate to financial statement analysis.

Question 9

Kim's Copy Shop is in the process of organizing its assets in the appropriate order. They ask you for help in arranging the following assets: equipment, accounts receivable, cash, merchandise inventory, and notes receivable. You list ____ first and ____ last.
A)merchandise inventory; notes receivable
B)accounts receivable; equipment
C)notes receivable; accounts receivable
D)equipment; accounts receivable
E)cash; equipment

Accepted Answer

Cash should be listed first as it is the most liquid asset and can be easily converted into other forms of assets. Equipment should be listed last as it is the least liquid asset and cannot be easily converted into cash. The correct order is: Cash, Accounts Receivable, Notes Receivable, Merchandise Inventory, Equipment.

Question 10

Television sets that Best Buy owns for selling to its customers are classified as
A)equipment.
B)machinery.
C)receivables.
D)merchandise inventory.
E)prepaid merchandise.

Accepted Answer

The television sets that Best Buy owns for selling to its customers are considered as merchandise inventory since they are held for sale in the ordinary course of business.

Question 11

Ebony Jones is hired by Ruby Tuesday to help with budgeting, determining the costs of the firm's meal services, and recording transactions and creating financial statements. Ebony is a
A)private accountant.
B)budget manager.
C)public accountant.
D)clerk.
E)public auditor.

Accepted Answer

Ebony Jones is hired by Ruby Tuesday, which implies that she works for a private company. Her role involves budgeting, determining costs, and recording transactions, which are typical responsibilities of a private accountant. Therefore, A) private accountant is the best choice.

Question 12

​All of the following, except _____, can provide answers to a variety of questions about a firm's ability to do business and stay in business, its profitability, and its value as an investment.
A)​bank statements
B)​balance sheet
C)​income statement
D)​statement of cash flows

Accepted Answer

Bank statements may provide information about a firm's cash flow, but they do not provide comprehensive financial statements that can answer questions about a firm's ability to do business, profitability, or value as an investment. The other options listed (balance sheet, income statement, statement of cash flows) are all examples of comprehensive financial statements that can provide information on these topics.

Question 13

In order for The Gift Market, a local specialty store, to purchase Christmas merchandise for selling in its store, it had to borrow money from a local bank. This debt owed to the bank is a(n)
A)liability.
B)expense.
C)owners' equity.
D)asset.
E)credit.

Accepted Answer

The debt owed to the bank is a liability, as it represents an obligation for The Gift Market to pay back the borrowed funds.

Question 14

Which type of manager would be most concerned with information about the products offered by competitors?
A)Financial
B)Marketing
C)Operations
D)Administrative
E)Human resources

Accepted Answer

Marketing managers are responsible for developing and implementing strategies to promote and sell products or services. One of their key tasks is to analyze market trends and gather information about the products and services of competitors to ensure that their company's offerings remain competitive. Financial managers are more concerned with managing a company's financial resources, operations managers are focused on ensuring efficient production processes, administrative managers oversee administrative tasks such as record-keeping and personnel, and human resources managers handle employment-related issues.

Question 15

While chief executives and financial officers are currently not subject to criminal penalties, they are required to certify periodic financial reports.

Accepted Answer

The answer of While chief executives and financial officers are...

Question 16

KYZ Radio pays salaries, rent, insurance, and utilities each month. These are all
A)current assets.
B)operating expenses.
C)cost of merchandise sold.
D)fixed liabilities.
E)None of these answers is correct.

Accepted Answer

Salaries, rent, insurance, and utilities are all operating expenses, which are expenses that a business incurs as part of its normal, day-to-day operations. Current assets are assets that are expected to be converted into cash within one year, cost of merchandise sold is the cost of goods that were sold during a period of time, and fixed liabilities are debts that are due more than one year from the current date. None of these categories appropriately describe the expenses listed in the question.

Question 17

Winshare Art Company has issued only common stock. Currently it has 10,000 shares outstanding. The value of the stock is shown as $20 per share. In addition, $100,000 of Winshare's earnings have been reinvested in the business since it was founded. What is Winshare's total owners' equity?
A)$300,000
B)$200,000
C)$100,000
D)$2,000,000
E)$100,020

Accepted Answer

The total owners' equity can be calculated by adding the value of the outstanding shares to the earnings reinvested in the business. The value of the outstanding shares is 10,000 shares * $20/share = $200,000. Adding the reinvested earnings of $100,000 gives a total of $300,000.

Question 18

Salaries payable, accounts payable, and taxes payable are examples of
A)expenses.
B)current liabilities.
C)current assets.
D)long-term liabilities.
E)owners' equity.

Accepted Answer

Salaries payable, accounts payable, and taxes payable are all examples of current liabilities, which are obligations that are expected to be settled within one year.

Question 19

The financial statement that provides information about a firm's operating, investing, and financing activities during an accounting period is the
A)balance sheet.
B)income statement.
C)cash flows statement.
D)retained earnings statement.
E)financial analysis statement.

Accepted Answer

The cash flows statement provides information about a firm's operating, investing, and financing activities during a specific accounting period. The balance sheet provides information about the firm's assets, liabilities, and equity at a specific point in time. The income statement provides information about the firm's revenues and expenses during a specific accounting period. The retained earnings statement provides information about changes in the firm's retained earnings during a specific accounting period. The financial analysis statement is not a commonly recognized financial statement.

Question 20

All of the following are classified as fixed assets except
A)factory equipment.
B)a company car.
C)computers held for resale.
D)property.
E)buildings.

Accepted Answer

Fixed assets are long-term assets that a company acquires for normal operations and are not expected to be sold. Computers held for resale are classified as inventory rather than fixed assets.

Quiz 15: Using Management Information Systems and Accounting Information

Cash, marketable securities, notes receivable, and merchandise inventory are examples of

Jessica has worked for one week but her employer only pays its employees every two weeks. The amount of money her company owes her is classified as

Merchandise that has been sold and is returned to the firm by the customer is called

The cash at the end of the year reported on the statement of cash flows is the same as the

A low inventory turnover can be improved by ordering merchandise in smaller quantities at more frequent intervals.

The ratio obtained by dividing net income after taxes by net sales is the

Which of the following statements is false?

Commonly used in accounting analysis, a ____ shows a relationship between two elements of a firm's financial statements.

Kim's Copy Shop is in the process of organizing its assets in the appropriate order. They ask you for help in arranging the following assets: equipment, accounts receivable, cash, merchandise inventory, and notes receivable. You list first and last.

Television sets that Best Buy owns for selling to its customers are classified as

Ebony Jones is hired by Ruby Tuesday to help with budgeting, determining the costs of the firm's meal services, and recording transactions and creating financial statements. Ebony is a

All of the following, except _____, can provide answers to a variety of questions about a firm's ability to do business and stay in business, its profitability, and its value as an investment.

In order for The Gift Market, a local specialty store, to purchase Christmas merchandise for selling in its store, it had to borrow money from a local bank. This debt owed to the bank is a(n)

Which type of manager would be most concerned with information about the products offered by competitors?

While chief executives and financial officers are currently not subject to criminal penalties, they are required to certify periodic financial reports.

KYZ Radio pays salaries, rent, insurance, and utilities each month. These are all

Winshare Art Company has issued only common stock. Currently it has 10,000 shares outstanding. The value of the stock is shown as $20 per share. In addition, $100,000 of Winshare's earnings have been reinvested in the business since it was founded. What is Winshare's total owners' equity?

Salaries payable, accounts payable, and taxes payable are examples of

The financial statement that provides information about a firm's operating, investing, and financing activities during an accounting period is the

All of the following are classified as fixed assets except

Quiz 15: Using Management Information Systems and Accounting Information

Cash, marketable securities, notes receivable, and merchandise inventory are examples of

Jessica has worked for one week but her employer only pays its employees every two weeks. The amount of money her company owes her is classified as

Merchandise that has been sold and is returned to the firm by the customer is called

The cash at the end of the year reported on the statement of cash flows is the same as the

A low inventory turnover can be improved by ordering merchandise in smaller quantities at more frequent intervals.

The ratio obtained by dividing net income after taxes by net sales is the

Which of the following statements is false?

Commonly used in accounting analysis, a ____ shows a relationship between two elements of a firm's financial statements.

Kim's Copy Shop is in the process of organizing its assets in the appropriate order. They ask you for help in arranging the following assets: equipment, accounts receivable, cash, merchandise inventory, and notes receivable. You list ____ first and ____ last.

Television sets that Best Buy owns for selling to its customers are classified as

Ebony Jones is hired by Ruby Tuesday to help with budgeting, determining the costs of the firm's meal services, and recording transactions and creating financial statements. Ebony is a

​All of the following, except _____, can provide answers to a variety of questions about a firm's ability to do business and stay in business, its profitability, and its value as an investment.

In order for The Gift Market, a local specialty store, to purchase Christmas merchandise for selling in its store, it had to borrow money from a local bank. This debt owed to the bank is a(n)

Which type of manager would be most concerned with information about the products offered by competitors?

While chief executives and financial officers are currently not subject to criminal penalties, they are required to certify periodic financial reports.

KYZ Radio pays salaries, rent, insurance, and utilities each month. These are all

Winshare Art Company has issued only common stock. Currently it has 10,000 shares outstanding. The value of the stock is shown as $20 per share. In addition, $100,000 of Winshare's earnings have been reinvested in the business since it was founded. What is Winshare's total owners' equity?

Salaries payable, accounts payable, and taxes payable are examples of

The financial statement that provides information about a firm's operating, investing, and financing activities during an accounting period is the

All of the following are classified as fixed assets except

Kim's Copy Shop is in the process of organizing its assets in the appropriate order. They ask you for help in arranging the following assets: equipment, accounts receivable, cash, merchandise inventory, and notes receivable. You list first and last.

All of the following, except _____, can provide answers to a variety of questions about a firm's ability to do business and stay in business, its profitability, and its value as an investment.