ACC 421 Final Exam


1) Why are certain costs of doing business capitalized when incurred and then depreciated or amortized over subsequent accounting cycles?

2) An accrued expense can best be described as an amount

3) If, during an accounting period, an expense item has been incurred and consumed but not yet paid for or recorded, then the end-of-period adjusting entry would involve

4) The information provided by financial reporting pertains to

5) One objective of financial reporting is to provide

6) The two primary qualities that make accounting information useful for decision making are

7) The body that has the power to prescribe the accounting practices and standards to be employed by companies that fall under its jurisdiction is the

8) The Financial Accounting Foundation

9) The major distinction between the Financial Accounting Standards Board (FASB) and its predecessor, the Accounting Principles Board (APB), is

10) The occurrence which most likely would have no effect on 2007 net income (assuming that all amounts involved are material) is the

11) Which of the following would represent the least likely use of an income statement prepared for a business enterprise?

12) The single-step income statement emphasizes

13) Which of the following is not a reason why revenue is recognized at time of sale?

14) The process of formally recording or incorporating an item in the financial statements of an entity is

15) Which of the following is not an accurate representation concerning revenue recognition?

16) The correct order to present current assets is

17) The amount of time that is expected to elapse until an asset is realized or otherwise converted into cash is referred to as

18) One criticism not normally aimed at a balance sheet prepared using current accounting and reporting standards is

19) The focus of APB Opinion No. 22 is on the disclosure of accounting policies. This information is important to financial statement readers in determining

20) Events that occur after the December 31, 2008 balance sheet date (but before the balance sheet is issued) and provide additional evidence about conditions that existed at the balance sheet date and affect the reliazibility of accounts receivable should be

21) The full disclosure principle, as adopted by the accounting profession, is best described by which of the following?

22) Companies should disclose all of the following in interim reports except

23) Which of the following best characterizes the difference between a financial forecast and a financial projection?

24) A financial forecast per professional pronouncements presents to the best of the responsible party s knowledge and belief,

25) Which of the following ratios measures long-term solvency?

26) The payout ratio is calculated by dividing

27) Theoretically, in computing the receivables turnover, the numerator should include

28) The primary purpose of the statement of cash flows is to provide information

29) The first step in the preparation of the statement of cash flows requires the use of information included in which comparative financial statements?

30) A company borrows $10,000 and signs a 90-day nontrade note payable. In preparing a statement of cash flows (indirect method), this event would be reflected as a(n)

31) The amortization of bond premium on long-term debt should be presented in a statement of cash flows (using the indirect method for operating activities) as a(n)

32) In a statement of cash flows, the cash flows from investing activities section should report

33) In reporting extraordinary transactions on a statement of cash flows (indirect method), the

34) Which of the following tables would show the smallest factor for an interest rate of 10% for six periods?

35) Which table would show the largest factor for an interest rate of 8% for five periods?

36) Which of the following tables would show the smallest value for an interest rate of 5% for six periods?