Chapter 15
Certified Public Accountant (CPA)
A certified public accountant (CPA) is an individual who has met state requirements for accounting education and experience and has passed a rigorous accounting examination.
information
Information is data presented in a form that is useful for a specific purpose, whereas data are the numerical or verbal descriptions that usually result from some sort of measurement.
Management Information Systems (MIS)
One of the main goals of a firm's information technology officer is to make sure that a firm has the equipment necessary to provide information the employees need to make effective decisions at a reasonable cost.
Because of several accounting scandals that led to the financial disintegration of large companies and the accounting firms that perpetrated the scandals, Congress enacted the______________
Sarbanes-Oxley Act
If a firm sold all of its assets and paid all of its bills, what would remain? a. Owners' equity b. Assets c. Liabilities d. Income
a. Owners' equity
What function is being served by employees who take data from a management information system and compile it into a report that includes graphs, charts, and a PowerPoint presentation? a. Present the information to users b. Store data c. Update data d. Process the data into information
a. Present the information to users
Large corporations normally distribute a(n)_______to stockholders and other interested parties that describes a firm's operating activities and its financial condition.
annual report
Today, most corporations include in their_______comparisons of the important elements of their financial statements for recent years.
annual report
A company will request a(n)______when it wants to determine if its financial statements have been prepared in accordance with generally accepted accounting principles.
audit
When determining if a company has a cash surplus or cash deficit at the end of a specific period of time, one would typically subtract the expenses from the income. This can also be done as the first step in creating a budget. What is the specific name given to the financial document created for a business that would state its profit or loss? a. Balance sheet b. Income statement c. Statement of cash flows d. Financial statement
b. Income statement
Which of the following best describes a consistent pattern of cause and effect that can be used in an industry for creating a competitive edge over competitors and improving the firm's profits? a. Knowledge management b. Information rule c. Database d. Decision support system
b. Information rule
Firms require information on a variety of subjects so they can plan for the future, implement the plans, and evaluate the results against historical data. Which of the following managers needs information regarding future sales levels, current inventory levels, and the availability and cost of resources required to produce goods and services? a. Financial manager b. Operations manager c. Human resources manager d. Marketing manager
b. Operations manager
Which of the following should be used to evaluate a firm's ability to pay its current liabilities? a. Return on sales b. Inventory turnover c. Current ratio d. Financial ratio
c. Current ratio
A_________is an individual who has met state requirements for accounting education and experience and has passed a rigorous accounting examination.
certified public accountant (CPA)
A company selling goods subtracts______from sales to determine gross profit.
cost of goods
What function is an employee of a firm conducting when he or she systematically collects, analyzes, and reports the financial information to the company in the form required to make decisions about a firm's financing, investing, marketing, and operating activities? a. Tax preparation b. Bookkeeping c. Auditing d. Accounting
d. Accounting
Which of the following best describes the information provided by a statement of cash flows? a. Profit or loss b. Revenues c. Assets, liabilities, and owners' equity d. Cash on hand
d. Cash on hand
As part of the accounting process, employees provide managers and employees within the organization with information needed to determine the cost of producing specific products or services. This information is used to evaluate current expenses and to compare them to historic data, international data, and data from suppliers, subcontractors (if any), and other processers (if any) to determine if a less expensive alternative is available that will generate the same product quality. What specific type of accounting is being performed in the beginning of this process? a. Financial accounting b. Managerial accounting c. Government accounting d. Cost accounting
d. Cost accounting
The collection of information about customers, such as their preferences, locations, demographics, and mobility is important for business success. Organizing and using this information is imperative to a business' survival. Which of the following describes a procedure for generating, using, and sharing important data and information? a. Expert system b. Database c. Information rule d. Knowledge management
d. Knowledge management
When considering the specific information needed to make decisions,_______managers consider current wage levels and benefits, legislation, and court decisions regarding employment.
human resources
The statement of cash flows
illustrates how the company's operating, investing, and financing activities affect cash during an accounting period.
_______is the presentation of raw numerical or verbal descriptions in a form that is useful for a specific purpose.
information
When managers are selecting a management information system they must tailor it to the needs of the organization it serves. The information technology officer must make sure that the system provides_______at a reasonable cost.
relevant information
When a company wants to determine how its operating, investing, and financial activities affect cash during an accounting period, it will have a_______prepared.
statement of cash flows