Financial Reporting CPA Exam
Questions & Answers (Grade A+)
What is the purpose of information presented in notes to the
financial statements? -
correct answer ✅To provide disclosure required by generally
accepted accounting principles.
choose the correct statement about GAAP -
correct answer ✅It is a violation of SEC regulations for publicaly
traded companies to depart from GAAP
FASB has maintained that -
correct answer ✅New GAAP should be neutral and not favor any
particular reporting objective.
Which of the following is true regarding the comparison of
managerial to financial accounting -
correct answer ✅Managerial Accounting need not follow GAAP
while financial accounting must follow them
In analyzing a companys financial statement, which financial
statement would a potential investor primarily use to access the
companys liquidity and financial flexibility -
correct answer ✅Balance Sheet
Questions & Answers (Grade A+)
What is the purpose of information presented in notes to the
financial statements? -
correct answer ✅To provide disclosure required by generally
accepted accounting principles.
choose the correct statement about GAAP -
correct answer ✅It is a violation of SEC regulations for publicaly
traded companies to depart from GAAP
FASB has maintained that -
correct answer ✅New GAAP should be neutral and not favor any
particular reporting objective.
Which of the following is true regarding the comparison of
managerial to financial accounting -
correct answer ✅Managerial Accounting need not follow GAAP
while financial accounting must follow them
In analyzing a companys financial statement, which financial
statement would a potential investor primarily use to access the
companys liquidity and financial flexibility -
correct answer ✅Balance Sheet
