TEST BANK FOR FINANCIAL ACCOUNTING FOR MBA
m m m m m m
S 8TH EDITION BY EASTON
m m m m
, Module 1 m
Financial Accounting for MBAs
m m m
Learning Objs – Coverage by question
m m m m m
True/False MultiplemChoice
LO1m–
mExplainmandmassessmthemfourmmainmbusinessmactivi
ties.
LO2m–
1-m4 1,m2
mIdentifymandmdiscussmthemusersmandmsuppliersmofmfi
nancialmstatementminformation.
LO3m–
5-10 3-19
mDescribemandmexaminemthemfourmfinancialmstatem
ents,mandmdefinemthemaccountingmequation.
LO4m–
11-13 20-25
mExplainmandmapplymthembasicsmofmprofitabilitymanaly
sis.
LO5m–
14 26,m27
mAssessmbusinessmoperationsmwithinmthemcontextmof
mamcompetitivemenvironment.
LO6m–
mAccessmreportsmfiledmwithmthemSECm(Appendixm1A).
LO7m–
mDescribemthemaccounting mprinciplesmandmregulati 15 28-30
onsmthatmframemfinancialmstatementsm(Appendixm1B).
ThesemquestionsmaremavailablemtomassignminmmyBusinessCourse.
©mCambridgemBusinessmPublishers,m2021
1-1 FinancialmAccountingmformMBAs,m8thmEdition
,Modulem1:mFinancialmAccountingmformMBAs
True/False
TOPIC:UsersmofmFinancialmStatementmInformationm LO:
2
1. Shareholdersmdemandmfinancialminformationmprimarilymtomassessmprofitabilitymandmriskmwhereasmba
nkersmdemandminformationmprimarilymtomassessmcashmflowsmtomrepaymloanminterestmandmprincipal.
ACCURATEmANSWER:-True
Reasoning:->>-
>>>Whilembothmshareholdersmandmbankersmareminterestedminmallmtheminformationmcompaniesmprovid
e,mshareholdersmcaremaboutmmoremaboutmamfirm’smprofitabilitymandmbankersmcaremmoremaboutmsolve
ncymandmcreditworthiness.
TOPIC:PubliclymAvailablemFinancialmRepo
rtsmLO:m2
2. Publiclymtradedmcompaniesmaremrequiredmtomprovidemquarterlymfinancialmreportsmdirectlymtomthempublic.
ACCURATEmANSWER:-False
Reasoning:->>-
>>>CompaniesmprovidemelectronicmversionsmofmquarterlymfinancialmstatementsmtomthemSEC,mwhichm
postsmthemmtomthemInternetmformthempublicmtomaccessmthem.
TOPIC:UsersmofmFinancialmStatementmInformationm LO:
2
3. Publiclym tradedm companiesm providem financialm informationm primarilym tom satisfym them SECm andm t
hem taxmauthoritiesm(thatmis,mthemInternalmRevenuemService).
ACCURATEmANSWER:-False
Reasoningm:->>-
>>>Demandmforminformationmextendsmtommanymusers;mthemregulatorsmsuchmasmthemSECmandmthemI
RSmaremonlymonemclassmofmusers.
TOPIC:SECmFilingsmLO:
2
4. Publiclym tradedm companiesm mustm providem tom them Securitiesm Exchangem Commissionm annualm a
uditedmfinancialmstatementsm(10-Kmreports)mandmquarterlymauditedmfinancialmstatementsm(10-
Qmreports).
ACCURATEmANSWER:-False
Reasoning:->>->>>Quarterlymreportsmdomnotmneedmtombemaudited.
TOPIC:BalancemSh
eetmLO:m3
5. Ifm am firmm reportsm retainedm earningsm ofm $175.3m millionm onm itsm balancem sheet,m itm mustm alsom report
$175.3mmillionminmcash.
ACCURATEmANSWER:-False
Reasoning:->>-
>>>Themaccountingmequationmrequiresmtotalmassetsmtomequalmtotalmliabilitiesmplusmstockholders’mequ
ity.mThatmdoesmnotmimply,mhowever,mthatmliabilitymandmequitymaccountsmrelatemdirectlymtomspecificmas
sets.
©mCambridgemBusinessmPublishers,m2021
, TestmBankm(T/Fm&mMC),mModulem1 1-2
m m m m m m
S 8TH EDITION BY EASTON
m m m m
, Module 1 m
Financial Accounting for MBAs
m m m
Learning Objs – Coverage by question
m m m m m
True/False MultiplemChoice
LO1m–
mExplainmandmassessmthemfourmmainmbusinessmactivi
ties.
LO2m–
1-m4 1,m2
mIdentifymandmdiscussmthemusersmandmsuppliersmofmfi
nancialmstatementminformation.
LO3m–
5-10 3-19
mDescribemandmexaminemthemfourmfinancialmstatem
ents,mandmdefinemthemaccountingmequation.
LO4m–
11-13 20-25
mExplainmandmapplymthembasicsmofmprofitabilitymanaly
sis.
LO5m–
14 26,m27
mAssessmbusinessmoperationsmwithinmthemcontextmof
mamcompetitivemenvironment.
LO6m–
mAccessmreportsmfiledmwithmthemSECm(Appendixm1A).
LO7m–
mDescribemthemaccounting mprinciplesmandmregulati 15 28-30
onsmthatmframemfinancialmstatementsm(Appendixm1B).
ThesemquestionsmaremavailablemtomassignminmmyBusinessCourse.
©mCambridgemBusinessmPublishers,m2021
1-1 FinancialmAccountingmformMBAs,m8thmEdition
,Modulem1:mFinancialmAccountingmformMBAs
True/False
TOPIC:UsersmofmFinancialmStatementmInformationm LO:
2
1. Shareholdersmdemandmfinancialminformationmprimarilymtomassessmprofitabilitymandmriskmwhereasmba
nkersmdemandminformationmprimarilymtomassessmcashmflowsmtomrepaymloanminterestmandmprincipal.
ACCURATEmANSWER:-True
Reasoning:->>-
>>>Whilembothmshareholdersmandmbankersmareminterestedminmallmtheminformationmcompaniesmprovid
e,mshareholdersmcaremaboutmmoremaboutmamfirm’smprofitabilitymandmbankersmcaremmoremaboutmsolve
ncymandmcreditworthiness.
TOPIC:PubliclymAvailablemFinancialmRepo
rtsmLO:m2
2. Publiclymtradedmcompaniesmaremrequiredmtomprovidemquarterlymfinancialmreportsmdirectlymtomthempublic.
ACCURATEmANSWER:-False
Reasoning:->>-
>>>CompaniesmprovidemelectronicmversionsmofmquarterlymfinancialmstatementsmtomthemSEC,mwhichm
postsmthemmtomthemInternetmformthempublicmtomaccessmthem.
TOPIC:UsersmofmFinancialmStatementmInformationm LO:
2
3. Publiclym tradedm companiesm providem financialm informationm primarilym tom satisfym them SECm andm t
hem taxmauthoritiesm(thatmis,mthemInternalmRevenuemService).
ACCURATEmANSWER:-False
Reasoningm:->>-
>>>Demandmforminformationmextendsmtommanymusers;mthemregulatorsmsuchmasmthemSECmandmthemI
RSmaremonlymonemclassmofmusers.
TOPIC:SECmFilingsmLO:
2
4. Publiclym tradedm companiesm mustm providem tom them Securitiesm Exchangem Commissionm annualm a
uditedmfinancialmstatementsm(10-Kmreports)mandmquarterlymauditedmfinancialmstatementsm(10-
Qmreports).
ACCURATEmANSWER:-False
Reasoning:->>->>>Quarterlymreportsmdomnotmneedmtombemaudited.
TOPIC:BalancemSh
eetmLO:m3
5. Ifm am firmm reportsm retainedm earningsm ofm $175.3m millionm onm itsm balancem sheet,m itm mustm alsom report
$175.3mmillionminmcash.
ACCURATEmANSWER:-False
Reasoning:->>-
>>>Themaccountingmequationmrequiresmtotalmassetsmtomequalmtotalmliabilitiesmplusmstockholders’mequ
ity.mThatmdoesmnotmimply,mhowever,mthatmliabilitymandmequitymaccountsmrelatemdirectlymtomspecificmas
sets.
©mCambridgemBusinessmPublishers,m2021
, TestmBankm(T/Fm&mMC),mModulem1 1-2
