Chap 17 - Business
If financial management is the heartbeat of competitive businesses, what keeps that heartbeat stable? Multiple choice question. lending institutions operations accounting information financial software
accounting information
Since converting the firm's inventory to profits is a key function of management, firms use ______ to measure the effectiveness of management in utilizing the assets that are available. Multiple choice question. activity ratios liquidity ratios leverage ratios debt ratios
activity ratios
The ratios that measure the effectiveness of a firm's management in turning over inventory are called ______. Multiple choice question. quick ratios activity ratios leverage ratios liquidity ratios
activity ratios
Stakeholders who want to look at detailed financial information on whether a company is profitable, is able to pay its bills, and how much debt it owes will look at the firm's ______. Multiple choice question. financial transactions tax returns annual report budgets
annual report
The _____________ ____________ provides information about a company's financial status to company managers, owners, government agencies, and the general public.
annual report
The ______________ ______________provides information about a company's financial status to company managers, owners, government agencies, and the general public.
annual report
Fill in the blank question. Reviewing and evaluating of records used to prepare a company's financial statements is referred to as _______________.
auditing
Reviewing and evaluating records used to prepare a company's financial statements is referred to as ______. Multiple choice question. auditing accounting reporting bookkeeping
auditing
The key working areas of accounting include managerial accounting, financial accounting, tax accounting, government and nonprofit accounting, and _____________.
auditing
Leverage or debt ratios measure the degree to which a firm relies on ______. Multiple choice question. borrowed funds profitability tangible assets owners equity
borrowed funds
Leverage or debt ratios measure the degree to which a firm relies on ______. Multiple choice question. tangible assets borrowed funds owners equity profitability
borrowed funds
It's possible for a business to increase its sales and profits yet still suffer ___________ flow problems.
cash
The statement of cash flows is a financial statement that shows ______. Multiple choice question. assets and liabilities cash receipts and disbursements changes in stockholders equity revenues and expenses
cash receipts and disbursements
An accountant's time is freed up to do more important tasks such as financial analysis due to the assistance provided by using ______. Multiple choice question. double-entry accounting computerized accounting programs a trial balance the accounting cycle
computerized accounting programs
In accounting, liabilities refer to ______. Multiple choice question. debts a business owes to others cash transactions associated with running a business the economic resources of a firm the different forms of revenue a firm generates
debts a business owes to others
Users of managerial accounting information include ______. (Select all that apply) Multiple select question. department managers Internal Revenue Service the Chief Financial Officer potential investors
department managers the Chief Financial Officer
A summary of all the financial transactions that have occurred over a particular period is referred to as a ______. Multiple choice question. tax return annual report journal entry financial statement
financial statement
Because they indicate a firm's financial health and stability, the use of ______ are key factors in management decision making. Multiple choice question. annual reports ledger entries tax returns financial statements
financial statements
_______________ accounting generates financial information for people outside the firm, while ______________accounting generates financial information for people inside the firm
financial; managerial
What is another name for debts? Multiple choice question. assets liquidity equity liabilities
liabilities
The current ratio is an example of a(n) _____________ ratio that measures a company's ability to turn assets into cash to pay its short-term debts. Listen to the complete question
liquidity
The current ratio is an example of a(n) _____________ratio that measures a company's ability to turn assets into cash to pay its short-term debts.
liquidity
Which are considered to be the working areas of accounting? (Select all that apply) Multiple select question. managerial accounting financial accounting auditing bank accounting government and not-for-profit accounting tax accounting
managerial accounting financial accounting auditing government and not-for-profit accounting tax accounting
In operating a business, rent, salaries, supplies, utilities and insurance are all examples of ______. Multiple choice question. operating expenses liabilities revenue accounts assets
operating expenses
The major categories of the balance sheet are assets, liabilities, and ______. Multiple choice question. income retained earnings owners' equity profit
owners equity
The value of what stockholders own in a firm minus any liabilities is called ______. Multiple choice question. retained earnings operating income owners' equity deferred income
owners' equity
Financial accounting and managerial accounting differ in terms of who uses the information. Financial accounting provides information primarily for ______. Multiple choice question. people inside the organization people outside the organization the government managerial accountants
people inside the organization
A business that does not need a full-time accountant, would most likely use a ______ accountant in which services are exchanged for a fee. Multiple choice question. private specialized public internal
public
The formula for the costs of goods sold is ______. Multiple choice question. purchase price + freight charges + storage costs purchase price -returns-freight and storage charges purchase price + returns - allowances purchase price + freight charges + taxes
purchase price + freight charges + storage costs
Calculating and interpreting financial ratios developed from the firm's financial statements is called: Multiple choice question. ratio analysis income analysis financial analysis asset analysis
ratio analysis
Which are steps in the accounting cycle? (Select all that apply) Multiple select question. record transaction in the journal build a budget analyze transactions prepare a trial balance determine investment opportunities
record transaction in the journal analyze transactions prepare a trial balance
Which are steps in the accounting cycle? (Select all that apply) Multiple select question. record transaction in the journal build a budget determine investment opportunities analyze transactions prepare a trial balance
record transaction in the journal analyze transactions prepare a trial balance
An indirect measure of risk that tells us how much a firm earned for each dollar invested by its owners is called ______. Multiple choice question. the current ratio return on equity earnings per share return on sales
return on equity
The monetary value of what a firm received for goods sold, services rendered, and other payments is termed ______________ .
revenue
Cash flow analysis is especially important for which of the following? Multiple choice question. the federal government small businesses the state government large businesses
small businesses
Cash receipts and disbursements related to operations, investments, and financing are reported on the ______. Multiple choice question. statement of cash flows income statement balance sheet ledger
statement of cash flows
On a balance sheet, assets may include ______. (Select all that apply) Multiple select question. tangible resources retained earnings intangible resources goodwill bonds payable
tangible resources intangible resources goodwill
What type of accountant is most likely to develop strategies for a firm in dealing with the Internal Revenue Service? Multiple choice question. tax accountant private accountant certified internal auditor management accountant
tax accountant
Government and nonprofit accounting involves working for organizations whose purpose is to serve ______. (Select all that apply) Multiple select question. stockholders taxpayers ratepayers partners
taxpayers ratepayers
Stockholders, or owners' equity represents ______. Multiple choice question. the value of the corporate stock on the market the amount the owners owe in debt the total value of what a business owns the value of the business that belongs to owners
the value of the business that belongs to owners
Return on equity is net income minus taxes divided by ______. Multiple choice question. net sales current liabilities total owners' equity common stock outstanding
total owners' equity
In using the accounting equation, if assets = $40,000 and liabilities = $30,000, then owner's equity is equal to ______. Multiple choice question. $10,000 $80,000 $70,000 $20,000
$10,000
In the fundamental accounting equation:_____________ = Liabilities + Owners' equity.
Assets
What are four main types of financial ratios used in ratio analysis? Multiple select question. Debt ratios Profitability ratios Income ratios Activity ratios Liquidity ratios Tax ratios
Debt ratios Profitability ratios Activity ratios Liquidity ratios
True or false: Gross profit is what a company shows on their income statement as the bottom line figure. True false question. True False
False (Net income is the bottom line)
The principles, defined by FASB, that accountants must follow to assure that a firm's accounting information is accurate are abbreviated as ______. Multiple choice question. SEC FASB GAAP CPA
GAAP
___________ is the monetary value of what a company received for goods sold, services rendered, and all other payments to the firm. Multiple choice question. Interest Revenue Rent Sales
Revenue
Assets, liabilities, and owners' equity are the major accounts listed on ______. Multiple choice question. a balance sheet a profit and loss statement a statement of cash flows an income statement
a balance sheet
The income statement shows ______. Multiple choice question. a firm's profit (or loss) after costs, expenses, and taxes the basic accounting equation inflows and outflows of cash a firm's assets, liabilities, and stockholders equity
a firm's profit (or loss) after costs, expenses, and taxes
Recording, classifying, summarizing, and interpreting financial events in an organization is referred to as ______. Multiple choice question. investing accounting management finance
accounting
