A100 Review foo cuh

Which of the following is true of the form 10-k

It is a required filing to the SEC for all publicly traded companies

Which of the following is true of the FASB

It is responsible for GAAP

Which of the following is true of the FASB?

It is responsible for determining the reporting standards under GAAP

Which of the following is true about a liability?

It is the amount owed by the company by the end of the period

To record an end-of-the-period adjustment for the interest expense accrued during the year

Both liabilities and net income and understated

Which of the following is true about depreciation?

As it is recorded, total assets are decreased. Only recorded on buildings and equipment

Forgot to prepare the end-of-period adjustment recording that a portion of the prepaid insurance expired

Assets and net income are overstated

Which of the following increases total assets

Buying inventory on account

Which of the following lists contains only accounts found on the balance sheet?

Cash, accounts receivable, retained earnings, unearned revenue

Which of the following is correctly stated on the statement of cash flows

Collection of accounts receivable is an operating cash flow Unearned revenue is an operating cash inflow when it is recieved

Which of the following ratios would be the best indicator of the company's ability to pay its bills in the next year

Current ratio

Which of the following does the SEC consider the most important ratio of a publicly-held company

Earnings per share

Which of the following is true of expenses shown on a company's annual financial statement

Expenses are costs that were incurred during the year

Which of the following is true about accounts payable

It is the amount the company owes to suppliers of inventory at a point in time

Which of the following is the definition of a leverage ratio

It is a measure of the company's use of debt compared to equity

Which of the following describes "net income from operations?"

It is the subtotal before the gain or loss on the sale of land has been reported It is the net income before including the gain or loss on the sale of land

Which of the following is true regarding unearned revenue?

Liabilities are increased when unearned revenue is received. Assets are also increased when it is received Liabilities are decreased and revenue is increased when it is earned

On what day does inventory become an expense to the company

On the day the inventory is sold by the company

Which of the following transactions decreases total assets

Paying for an accounts payable

Which of the following transactions increases total assets

Purchasing inventory on account

Which of the following is true of accumulated depreciation

Recording depreciation causes the net carrying value of fixed assets to decrease The net carrying value of equipment is reduced as depreciation is recorded

Which of the following is true of accrual accounting?

Revenue is recorded on the income statement even when the cash has not yet been received

Which of the following is correctly stated on the statement of cash flows

The sales price on the sale of land is an investing cash inflow There is no entry on the statement of cash flows when unearned revenue is earned Uneared

True statement

There is no change in total assets when an account receivable is collected

If a company was interested in increasing it net income, which of the following would help do that?

Trying to reduce its expenses

Which of the following is not correct about the statement of cash flows?

When land is sold for a loss, the loss is an investing cash inflow

Which of the following ratios describes the extent to which the company relies on debt opposed to equity

leverage ratio

Prepayment is recorded as a

liability