acctg-201 chapter 1

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

FASB or F.A.S.B.

The private sector organization that is currently responsible for setting accounting standards in the United States is the

Financial Accounting Standards Board.

The system that maintains records of a company's operations and then communicates that information to decision makers is referred to as ___. (Enter one word per blank)

accounting

Accounting professionals:

are in high demand

The financial statement that displays s firm's financial position on a particular date is the ___ ___. (Enter one word per blank)

blank 1: balance blank 2: sheet

Information that best explains companies' stock price performance is reported in the ___ ___. (Enter one word per blank.)

blank 1: income blank 2: statement

To be useful for decision making, information should possess the fundamental qualities of relevance and ___ representation.

faithful, faithfulness, or faithfully

True or false: Technical accounting skills represent the only skills required of accounting professionals.

false

True or false: The fundamental activities of a business are selling activities and marketing activities.

false

Which financial statement reports revenues and expenses?

income statement

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

income statement.

Careers for accounting professionals typically include a choice between public and ___ accounting.

private

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.

Undistributed profits that have accumulated in the company over time called ___ earnings. (Enter only one word.)

retained

Retained earnings represents

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

True or false: Accounting professionals enjoy a wide variety of career opportunities.

true

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

- dividends - net income - beginning balance of retained earnings

The two sources of stockholders' equity are amounts ___.

- earned by the corporation - paid in from shareholders

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

- expenses - net income or loss - revenues

In financial accounting which of the following are the three types of business activities of a company?

- financing activities - operating activities - investing activities

Which of the following are financial statements? (Select all that apply)

- income statement - statement of stockholders' equity - balance sheet

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

- leadership skills - ability to work in teams - technical accounting knowledge - presentation skills

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, accountants, or accountant

Which of the following financial statements shows a company's financial position on a particular date?

balance sheet

A net loss ___ retained earnings.

decreases

___ is a term that refers to a code or moral system that provides criteria for evaluating right or wrong. (Enter one word per blank.)

ethics, ethical conduct, ethical, or ethic

Companies communicate information about their business activities primarily through

financial statements

___ statements represent a company's primary means of communicating information to external users. (Enter one word per blank.)

financial, finance, or financing

When a company earns net income, its retained earnings:

increase

The primary functions of accounting are to:

- measure a company's activities - communicate information to decision makers

In our society, the two main functions of accounting are to

- measure business activities - communicate information to investors and creditors

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

- private - public

A code or moral system that provides criteria for evaluating right and wrong is referred to as

ethics.