ACC 210 Chapter 1

The financial statement that is most useful in explaining a company's stock price performance is the

income statement

Which of the following aspects relate to the information provided in an income statement?

Ability to earn a profit from its operations during the current period

The two main functions of _____ are to (1) measure business activities and (2) to communicate those measurements to investors and creditors. (Enter only one word.)

accounting

The financial statement that summarizes the profit-generating activities of a company during a particular period of time is the

income statement

The purpose of a(n) ____ ______ is to report the profit-generating activities of the firm during a period of time. (Enter one word per blank)

income statement

Two other types of information in addition to the financial statements that must be reported in the annual reports include

notes disclosure and management discussion and analysis.

The statement of cash flows classifies items as

operating, investing, financing

The financial statement that provides information about cash receipts and cash disbursements for the period is the

statement of cash flows

Which of the following knowledge and skills should an accounting professional possess?

Ability to work in teams Presentation skills Leadership skills Technical accounting knowledge

Which of these would be found on a company's balance sheet? (Select all that apply.)

Accounts receivable, Equipment and Notes payable

Which of the following appear(s) on the balance sheet?

Accounts receivable, Utilities payable, Common stock, equipment, notes payable

Which of the following are financial statements? Statement of stockholders' equity Balance sheet Statement of corporate responsibility Income statement Statement of assets

Balance Sheet, statement of stockholders equity and income statement

The four financial statements published to provide information to external users include which of the following?

Balance sheet, statement of stockholder's equity, statement of cash flows, income statement

______ _____ represent a companys primary means of communicating information to external users

Financial accounting

Companies communicate information about their business activities primarily through

Financial statements

When a company earns net income, its retained earnings:

Increase

The primary functions of accounting are to:

Measure a company's activities and to communicate information to decision makers

Management discussion and analysis and note disclosures to the financial statements are included in the

annual report

The purpose of a statement of cash flows is to provide information about the

cash receipts and cash disbursements during a period.

Which of the following appear on the statement of stockholders' equity? (Select all that apply.)

dividends, beginning balance of retained earnings and net income

Shareholders' equity arises primarily from amounts invested by shareholders and amounts ______.

earned by the corporation

Information that best explains companies' stock price performance is reported on the

income statement

Which of the following are attributes of FASB? (Select all that apply.)

independent, full time board members and private sector

Which of the following appear on the statement of stockholders' equity? (Select all that apply.)

Beginning balance of retained earnings Net income Dividends

An income statement reports: (Select all that apply.)

Expenses, revenues and net income or net loss

______ is the common abbreviation for the Board that currently establishes financial accounting and reporting standards in the U.S. (Enter the acronym.)

FASB

The financial statement that displays a firm's financial position on a particular date is the

balance sheet

The four financial statements published to provide information to external users include which of the following?

income statement, balance sheet, statement of stockholders equity and statement of cash flows

A balance sheet lists the assets,______ and stockholders' equity as of a specific date.

liabilities

The accounting equation is: Assets = ______ + Stockholders' Equity.

liabilities

3 most common forms of business organization

partnership, sole proprietorship and corporation

The two main career paths in accounting are referred to as:

private and public

The hierarchy of qualitative characteristics of financial information require that, in order to be useful for decision making, information should possess the fundamental characteristics of

relevance and faithful representation.

Which of the following represents the net income earned by a corporation and not yet paid to shareholders?

retained earnings

Profits earned by a company that have not been paid to stockholders are called

retained earnings

The purpose of an income statement is to:

summarize the profit-generating activities that occurred during a particular reporting period

Retained earnings represent:

the total net income earned over the life of the company that has not been distributed as dividends.