ACCT 6010 EXAM 1 REVIEW | FREQUENTLY TESTED
QUESTIONS WITH CORRECT ANSWERS | BRAND NEW!
A balance sheet shows a company's position over a period of time, whereas an
income statement, statement of stockholders' equity, and statement of cash
flows show its position at a point in time.
Select one:
True
False - Answer-:;False
Rationale: The statement is reversed: A balance sheet shows a company's position
at a point in time, whereas an income statement, statement of equity, and
statement of cash flows show its position over a period of time.
A statement of cash flows reports on cash flows for operating, investing and
financing activities at a point in time.
Select one:
True
False - Answer-:;False
,Rationale: A statement of cash flows reports on cash flows for operating,
investing, and financing activities over a period of time.
Assets must always equal liabilities plus equity.
Select one:
True
False - Answer-:;True
Rationale: The accounting equation is Assets = Liabilities + Equity. This relation
must always hold.
If a company reports retained earnings of $175.3 million on its balance sheet, it
must also report $175.3 million in cash.
Select one:
True
False - Answer-:;False
Rationale: The accounting equation requires total assets to equal total liabilities
plus stockholders' equity. That does not imply, however, that liability and equity
accounts relate directly to specific assets.
Publicly traded companies are required to provide quarterly financial reports
directly to the public.
, Select one:
True
False - Answer-:;False
Rationale: Companies provide electronic versions of quarterly financial
statements to the SEC, which posts them to the Internet for the public to access
them.
A "clean" audit report asserts - among other things - that a) the auditor has
prepared all necessary financial statements and b) management has expressed its
opinion that they are prepared in conformity with GAAP.
Select one:
True
False - Answer-:;False
Rationale: The statement is reversed: A "clean" audit report asserts - among other
things - that a) management has prepared all necessary financial statements and
b) the auditor has expressed its opinion that they are prepared in conformity with
GAAP.
Publicly traded companies must provide to the Securities Exchange Commission
annual audited financial statements (10K reports) and quarterly audited financial
statements (10Q reports).
Select one:
True
QUESTIONS WITH CORRECT ANSWERS | BRAND NEW!
A balance sheet shows a company's position over a period of time, whereas an
income statement, statement of stockholders' equity, and statement of cash
flows show its position at a point in time.
Select one:
True
False - Answer-:;False
Rationale: The statement is reversed: A balance sheet shows a company's position
at a point in time, whereas an income statement, statement of equity, and
statement of cash flows show its position over a period of time.
A statement of cash flows reports on cash flows for operating, investing and
financing activities at a point in time.
Select one:
True
False - Answer-:;False
,Rationale: A statement of cash flows reports on cash flows for operating,
investing, and financing activities over a period of time.
Assets must always equal liabilities plus equity.
Select one:
True
False - Answer-:;True
Rationale: The accounting equation is Assets = Liabilities + Equity. This relation
must always hold.
If a company reports retained earnings of $175.3 million on its balance sheet, it
must also report $175.3 million in cash.
Select one:
True
False - Answer-:;False
Rationale: The accounting equation requires total assets to equal total liabilities
plus stockholders' equity. That does not imply, however, that liability and equity
accounts relate directly to specific assets.
Publicly traded companies are required to provide quarterly financial reports
directly to the public.
, Select one:
True
False - Answer-:;False
Rationale: Companies provide electronic versions of quarterly financial
statements to the SEC, which posts them to the Internet for the public to access
them.
A "clean" audit report asserts - among other things - that a) the auditor has
prepared all necessary financial statements and b) management has expressed its
opinion that they are prepared in conformity with GAAP.
Select one:
True
False - Answer-:;False
Rationale: The statement is reversed: A "clean" audit report asserts - among other
things - that a) management has prepared all necessary financial statements and
b) the auditor has expressed its opinion that they are prepared in conformity with
GAAP.
Publicly traded companies must provide to the Securities Exchange Commission
annual audited financial statements (10K reports) and quarterly audited financial
statements (10Q reports).
Select one:
True
