A100 Review foo cuh
Which of the following is true of the form 10-k
It is a required filing to the SEC for all publicly traded companies
Which of the following is true of the FASB
It is responsible for GAAP
Which of the following is true of the FASB?
It is responsible for determining the reporting standards under GAAP
Which of the following is true about a liability?
It is the amount owed by the company by the end of the period
To record an end-of-the-period adjustment for the interest expense accrued during the year
Both liabilities and net income and understated
Which of the following is true about depreciation?
As it is recorded, total assets are decreased. Only recorded on buildings and equipment
Forgot to prepare the end-of-period adjustment recording that a portion of the prepaid insurance expired
Assets and net income are overstated
Which of the following increases total assets
Buying inventory on account
Which of the following lists contains only accounts found on the balance sheet?
Cash, accounts receivable, retained earnings, unearned revenue
Which of the following is correctly stated on the statement of cash flows
Collection of accounts receivable is an operating cash flow Unearned revenue is an operating cash inflow when it is recieved
Which of the following ratios would be the best indicator of the company's ability to pay its bills in the next year
Current ratio
Which of the following does the SEC consider the most important ratio of a publicly-held company
Earnings per share
Which of the following is true of expenses shown on a company's annual financial statement
Expenses are costs that were incurred during the year
Which of the following is true about accounts payable
It is the amount the company owes to suppliers of inventory at a point in time
Which of the following is the definition of a leverage ratio
It is a measure of the company's use of debt compared to equity
Which of the following describes "net income from operations?"
It is the subtotal before the gain or loss on the sale of land has been reported It is the net income before including the gain or loss on the sale of land
Which of the following is true regarding unearned revenue?
Liabilities are increased when unearned revenue is received. Assets are also increased when it is received Liabilities are decreased and revenue is increased when it is earned
On what day does inventory become an expense to the company
On the day the inventory is sold by the company
Which of the following transactions decreases total assets
Paying for an accounts payable
Which of the following transactions increases total assets
Purchasing inventory on account
Which of the following is true of accumulated depreciation
Recording depreciation causes the net carrying value of fixed assets to decrease The net carrying value of equipment is reduced as depreciation is recorded
Which of the following is true of accrual accounting?
Revenue is recorded on the income statement even when the cash has not yet been received
Which of the following is correctly stated on the statement of cash flows
The sales price on the sale of land is an investing cash inflow There is no entry on the statement of cash flows when unearned revenue is earned Uneared
True statement
There is no change in total assets when an account receivable is collected
If a company was interested in increasing it net income, which of the following would help do that?
Trying to reduce its expenses
Which of the following is not correct about the statement of cash flows?
When land is sold for a loss, the loss is an investing cash inflow
Which of the following ratios describes the extent to which the company relies on debt opposed to equity
leverage ratio
Prepayment is recorded as a
liability
