Quiz 1 Accounting

investing activities

Activities involving the purchase and sale of long-term assets as well as other major items used in a business's operation are referred to as:

Debt to Equity ratio

All of the following are considered measure of liquidity except:

False

T/F: Inventory is an example of a quick asset

False

T/F: Vertical analysis compares the results of financial information with a business in the same industry for a number of consecutive periods of time.

False

T/F: a company's liquidity refers to its ability to remain profitable

merchandising firm

Wal-mart is an example of which of the following?

financing activity

A fitness center repays $10,000 it borrowed from the bank to purchase an exercise machine this is an example of a(n)

periodicity concept

Every three months, Ashmont Antiques produces a report showing profits earned during the most recently ended quarter. This best describes an application of the

False

T/F: the current ratio may be less than, equal to, or greater than the quick ratio

False

T/F: the lower the current ratio, the more liquid the company appears.

True

T/F: the trend in ratios is usually more useful than looking at a single year's ratio.

Learning and Growth Perspective

The cost and effectiveness of research and development is part of which of the following balanced scorecard perspectives?

greater than or equal to

The current ratio will be ____________ the quick ratio.

financing activites

activities involving obtaining necessary funds to purchase long-term assets, repay existing obligations, and provide a return for owners are referred to as:

periodicity concept

the accounting concept requiring the profits of a business be determined at regular intervals throughout the life of the business is

going concern

the accounting concept which assumes that, absent any information to the contrary, the business will continue into the foreseeable future

operating activities

the profit making activities of an enterprise are referred to as:

operating activities

When a manufacturing of Hays Corporation ships its finished goods the company's retail stores this is part of its

Designing produce that meet the customers needs

Which of the following is not part of an internal control system?

corporation

a business entity which is legally separate and distinct from its owners is called a:

sole propretorship

a business owned by one person whose personal possesions are at risk if the business fails is called a:

investing activity

a delivery service purchases a new truck for $130,000. This is an example of a(n):

operating activity

a health-food retailer buys food for resale. This is an example of a(n):

service firm

a law firm is an example of which of the following?

1. financial perspective 2. learning and growth perspective 3. customer perspective 4. business process perspective

the balanced scorecard approach has four perspectives, what are they?

business entity concept

the owner of a dry cleaning business maintains separate checkbooks for his business and his personal affairs. this best describes an application of the:

GAAP

the statements of financial accounting standards, and other authoritative pronouncements that define what constitutes acceptable accounting practice for financial reporting are collectively referred to as: