business process chapter 14 smartbook

What is the main distinguishing factor between accountants and bookkeepers? Bookkeepers record financial information, while accountants do not. Accountants analyze and interpret financial information, while bookkeepers do not. Bookkeepers require additional training beyond a college accounting degree, while accountants do not. Accounting is more mechanical and narrow in focus compared to bookkeeping.

Accountants analyze and interpret financial information, while bookkeepers do not.

Which of the following is an accurate statement regarding the role of an accountant? Multiple choice question. Accountants are usually responsible for the routine, day-to-day transactions of a business. An accountant's role is essentially the same as a bookkeeper. Accounting requires less training than does bookkeeping. Accounting usually requires coursework beyond a college accounting degree.

Accounting usually requires coursework beyond a college accounting degree.

Which of the following is not a characteristic of a balance sheet? Multiple choice question. It indicates company assets and liabilities. It derives its name from its reliance on the accounting equation. It states that liabilities must equal owners' equity. It presents a "snapshot" of the organization.

It states that liabilities must equal owners' equity.

Organizations evaluate their operations through the recording, measurement, and interpretation of financial information. This process is known as Blank______.

accounting

Which two characteristics are especially important in accounting practices? Multiple select question. transparency accuracy philanthropy flexibility

accuracy, transparency

Receivables turnover is a type of ______ ratio.

asset utilization

Ratios that measure how well a firm uses its assets to generate each $1 of sales are Blank______.

asset utilization ratios

To be most effective, liquidity ratios should be examined in conjunction with Blank______. Multiple choice question. asset utilization ratios profitability ratios debt utilization ratios

asset utilization ratios

Double-entry bookkeeping strives to maintain the Blank______ of the accounting equation.

balance

A(n) Blank______ reports the firm's financial condition on a specific date.

balance sheet

A(n) Blank______ reports the firm's financial condition on a specific date. Multiple choice question. owner's equity statement transaction ledger profit and loss statement balance sheet

balance sheet

A ratio analysis combines information from which two reports? Multiple select question. statement of cash flows balance sheet owner's equity report income statement

balance sheet income statement

Managers of most firms tend to keep debt-to-asset levels Blank______.

below 50%

An individual who has been certified by the state in which he or she practices and has the right to express, officially, an unbiased opinion regarding the accuracy of a client's financial statements works as a(n) Blank______. Multiple choice question. corporate tax official certified public accountant certified bookkeeper independent auditor

certified public accountant

Ratios that measure how much debt an organization is using relative to other sources of capital, such as owners' equity are Blank______ ratios.

debt utilization

True or false: All financial statements follow the exact same format under government regulations.

false

true or false: CPAs pass and obtain their certification through the federal government.

false-from the state

The accounting cycle is most known as being a ______-step process.

four

______ is an intangible asset that often includes an organization's reputation.

goodwill

Which report summarizes an organization's profitability over a specific period, which may be a week, a month, or a year?

income statement

Which report summarizes an organization's profitability over a specific period, which may be a week, a month, or a year? income statement balance sheet statement of cash flows ratio analysis

income statement

What are the three types of asset utilization ratios? Multiple select question. inventory turnover total asset turnover retained earnings turnover total liabilities turnover receivables turnover

inventory turnover total asset turnover receivables turnover

Which type of ratio measures the speed with which a company can turn its assets into cash in order to meet its debts? Multiple choice question. Profitability ratio Activity ratio Debt utilization ratio Liquidity ratio Leverage ratio

liquidity ratio

Ratios that measure the speed with which a company can turn its assets into cash to meet short-term debt are ______________ ratios.

liquidity, current, or quick

The internal use of accounting statements by managers in planning and directing the organization's activities is known as _______ accounting.

managerial

Which two terms are synonymous with the term "income statement"? Multiple select question. balance sheet operating statement P&L statement trial balance statement of cash flows

operating statement P&L statement

Data used by investors to compare the performance of one company with another on an equal, per-share basis is the definition of Blank______. Multiple choice question. return on assets per-share data dividends per share earnings per share

per share data

Which three are examples of profitability ratios? Multiple select question. current ratio profit margin acid test return on equity return on assets

profit margin return on equity return on assets

What type of ratios measure how effectively a firm is using its various resources to achieve profits? Multiple choice question. liquidity profitability leverage activity

profitability

A ________analysis calculates an organization's financial health.

ratio

The ______ explains how the company's cash changed from the beginning of the accounting period to the end.

statement of cash flows

Accounting Cycle

the four-step procedure of an accounting system: examining source documents, recording transactions in an accounting journal, posting recorded transactions, and preparing financial statements.

True or false: In order to keep the accounting equation in balance, each business transaction must be recorded in two separate accounts.

true

True or false: People both inside as well as outside of an organization use accounting tools to evaluate organizational operations.

true

role of bookkeeper

usually responsible for the routine, day-to-day transactions of a business.