POST ACC305 unit 1 quiz

| September 29, 2018

QUESTION 1Which of the following is a characteristic of information provided by external financial reports?The information is exact and not subject to change.The information is frequently the result of reasonable estimatesThe information pertains to the economy as a whole.The information is provided at the least possible cost.1 points QUESTION 2Which of the following is not an objective of financial reporting?Financial reporting should provide information that is useful to present and potential investors and creditors and other users in making rational investment, credit, and similar decisions.Financial reporting should provide information to help present and potential investors and creditors and other users in assessing the amounts, timing, and uncertainty of prospective cash receipts from dividends or interest and the proceeds from the sale, redemption, or maturity of securities or loans.Financial reporting should provide information about the economic resources of an enterprise, the claims against those resources, and the effects of transactions, events, and circumstances that change the resources and claims against those resources.Financial accounting is designed to measure directly the value of a business enterprise.1 points QUESTION 3According to SFAC No. 6, assets can be defined by which of the following?Probable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past trans-actions or events.Probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.Residual interest on the assets of an entity that remains after deducting its liabilities.Increases in equity of a particular business enterprise resulting from transfers to the enterprise from other entities of something of value to obtain or increase ownership interests ( or equity) in it.1 points QUESTION 4According to SFAC No. 6, expenses can be defined by which of the following?Inflows or other enhancements of assets of an entity or settlements of its liabilities ( or a combina-tion of both) from delivering or producing goods, rendering services, or other activities that consti-tute the entity’s ongoing major or central operations.Outflows or other consumption or using up of assets or incurrences of liabilities ( or a combination of both) from delivering or producing goods, rendering services, or carrying out other activities that constitute the entity’s ongoing major or central operations.Increases in equity ( net assets) from peripheral or incidental transactions of an entity and from all other transactions and other events and circumstances affecting the entity during a period, except those that result from revenues or investments.Decreases in equity ( net assets) from peripheral or incidental transactions of an entity and from all other transactions and other events and circumstances affecting the entity during a period, except those that result from expenses or distributions to owners.1 points QUESTION 5If assets are $ 40,000 and stockholders’ equity is $ 10,000, how much are liabilities?$ 30,000$ 50,000$ 20,000$ 60,0001 points QUESTION 6In addition to the company’s principal financial statements, the Form 10- K and shareholder annual reports must include the following:Information on the market for holders of common stock and related securities, including high and low sales price, frequency and amount of dividends, and number of sharesFive- year summary of selected financial dataTwo years of audited balance sheets, three years of audited statements of income and statements of cash flowsDisclosure of the domestic and foreign components of pretax incomeAll of the above.1 points QUESTION 7Audit opinions cannot be classified as which of the following?All- purposeDisclaimer of opinionAdverse opinionQualified opinion1 points QUESTION 8From the point of view of analysis, which classification of an audit opinion indicates that the financial statements carry the highest degree of reliability?Unqualified opinionDisclaimer of opinionQualified opinionAdverse opinion1 points QUESTION 9This item need not be provided with a complete set of financial statements:Note disclosure of such items as accounting policiesA 20- year summary of operationsBalance sheetStatement of cash flows1 points QUESTION 10Which party has the primary responsibility for the financial statements?BookkeeperAuditorManagementCost accountant

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