Financial Statements

Is it true or false that the total amount of stockholders' equity reported on the balance sheet is intended to show the fair market value of the corporation? True False

F

The generally accepted accounting principles used in the financial statements of U.S corporations are researched and developed by which organization? American Accounting Association (AAA) Financial Accounting Standards Board (FASB) Internal Revenue Service (IRS)

FASB

Comprehensive income is defined as _______________ plus other comprehensive income. Extraordinary Items Gains And Losses Net Income

Net Income

Is it true or false that a grocery store's sale of its old delivery van to one of its employees for $2,000 should be recorded in the general ledger account Sales? True False

False

A corporation's net income will cause a change in which component of stockholders' equity? Accumulated Other Comprehensive Income Paid-in Capital Retained Earnings

RE

Which accounting method will result in financial statements that report a more complete picture of a corporation's financial position and a better measure of profitability during a recent accounting year? Accrual Method Cash Method

Accrual

Which type of journal entries are made at the end of each accounting period so that the financial statements better reflect the accrual method of accounting? Adjusting Closing Reversing

Adjusting

Which of the following will appear as a negative amount on a statement of cash flows that was prepared using the indirect method? A Decrease In Inventory An Increase In Accounts Payable An Increase In Accounts Receivable Depreciation Expense

An Increase In Accounts Receivable

Which financial statement's structure is closest to that of the basic accounting equation? Balance Sheet Income Statement Statement Of Cash Flows Statement Of Comprehensive Income Statement Of Stockholders' Equity

Balance Sheet

indirect method

Begins with Net income, then adjustments needed to convert the accrual accounting net income to CF from Operating Activities Weird things: Adding back depreciation expense Adding the decrease in accounts receivable Deducting the increase in inventory Deducting the decrease in accounts payable Adding the increase in accrued expenses payable

The amount spent for capital expenditures will be reported in which section of the statement of cash flows? Cash Provided/used In Financing Activities Cash Provided/used In Investing Activities Cash Provided/used In Operating Activities Supplemental Information

Cash Provided/used In Investing Activities

A corporation's working capital is calculated using which amounts? Total Assets and Total Liabilities Total Assets and Current Liabilities Current Assets and Current Liabilities

Current Assets and Current Liabilities

Which of the following will appear as a positive amount on a statement of cash flows that was prepared using the indirect method? An Increase In Accounts Receivable An Increase In Inventory A Decrease In Accounts Payable Depreciation Expense

Depreciation expense

Which is the annual report to the SEC that contains the financial statements of a publicly-traded corporation? Form 1040 Form 10-K Form 10-Q Schedule C

Form 10-K

Which financial statement will allow you to determine the gross margin for a retailer or manufacturer? Balance Sheet Income Statement Statement Of Cash Flows Statement Of Comprehensive Income Statement Of Stockholders' Equity

Income Statement

Ten years ago, a corporation started a new brand name that is now considered to be its most valuable asset. On which financial statement and at what amount will you see the brand name reported? Balance Sheet At Its Present Value Statement Of Comprehensive Income With No Value Not Reported On A Financial Statement

Not Reported

Important disclosures regarding likely losses that could not be estimated are found where? General Ledger Accounts Income Statement Notes To The Financial Statements

Notes To The Financial Statements

Does the heading of a balance sheet indicate a period of time or a point in time? Period Of Time Point In Time

Point

What is usually presented first in the notes to the financial statements? Accumulated Other Comprehensive Income Commitments And Contingencies Significant Accounting Policies

Significant Accounting Policies

Which financial statement reports the adjustments for changes in the market value of available-for-sale investment securities and adjustments for foreign currency translation? Statement Of Cash Flows Statement Of Comprehensive Income Statement Of Income

Statement Of Comprehensive Income

The changes that occurred during a recent year in the accounts Retained Earnings and Treasury Stock will be found in which financial statement? Balance Sheet Income Statement Statement Of Cash Flows Statement Of Comprehensive Income Statement Of Stockholders' Equity

Statement Of Stockholders' Equity

Direct Method

When the direct method of presenting a corporation's cash flows from operating activities is used, the amount of net income is not the starting point. Instead, the direct method lists the cash amounts received and paid by the corporation. Here are a few of the more common descriptions that will be seen under the direct method: Cash from customers Cash paid to employees Cash paid to suppliers Cash paid for interest The direct method also requires a reconciliation of net income to the cash provided by operating activities.