1
,
Financia and Manageria Accounting: Financia F F F
Chapters, 7e (Miller-Nobles)
Chapter F:1 Accounting and the Business
Environment
Learning Objective F:1-1
1) Accounting is the information system that measures business activities, processes the
F F F F F F F F F
information into F F
reports, and communicates the results to decision makers.
F F F F F F F FF
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
2) Critical thinking and judgment skills are not necessary for accountants because
F F F F F F F F F F F F
technology has made F F F
the activities routine.
F F F
Answer: FALSE FF F
Explanation: Technology plays an important supporting role in performing routine
FF F F F F F F F F F
accounting F
functions. This allows accountants to have more time to focus on reviewing and evaluating
FF F F F F F F F F F F F F F
economic F
activities using critical thinking and judgment.
F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
3) Accounting starts with economic activities that accountants review and evaluate using
F F F F F F F F F F F F
critical thinking F F
and judgment to create useful information that helps individuals make good decisions.
F F F F F F F F F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
,AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
4) Accounting is referred to as the language of business because it is the method of
F F F F F F F F F F F F F F F F
communicating F
business information to decision makers.
F F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
F
F
, F FF Accounting The Financial Chapters 7th Edition Nobles, 2 F F F F F F F F
, F
5) A model called the ________ was created to help students and the public understand what
F F F F F F F F F F F F F F F F
accounting F
is. F
A) Decision Making Model
F F F F
B) Business Model
F F F
C) Pathways Vision Model
F F F F
D) Cost Model
F F F
Answer: C FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
6) The Pathways Vision Model emphasizes that good decisions have an impact on
F F F F F F F F F F F F F
A) accounting judgments and economic activity.
F F F F F F
B) accounting judgments only.
F F F F
C) economic activity only.
F F F F
D) neither accounting judgments nor economic activity.
F F F F F F F
Answer: A FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
,7) Managerial accounting focuses on providing information for external decision makers.
F F F F F F F F F F F
Answer: FALSE FF F
Explanation: Managerial accounting focuses on providing information for internal decision
FF F F F F F F F F F
makers. F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
8) Investors primarily use managerial accounting information for decision-making
F F F F F F F F F
purposes. F
Answer: FALSE FF F
Explanation: External users (investors) use financial accounting information.
FF F F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
F
F
, F
, F
, F
3 F
, F
9) A creditor is a person who owes money to the business.
F F F F F F F F F F F F
Answer: FALSE FF F
Explanation: A creditor is a person to whom a business owes money.
FF F F F F F F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
10) Income tax is calculated using accounting information.
F F F F F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
11) Financial accounting focuses on information for decision makers outside of the
F F F F F F F F F F F F
, business, such as F F F
creditors and taxing authorities. F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
12) Business owners use accounting information to set goals, evaluate progress toward
F F F F F F F F F F F F
those goals, and F F F
make adjustments when needed.
F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
13) Outside investors ordinarily use financial accounting information to decide whether or
F F F F F F F F F F F F
not to invest F F F
in a business.
F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
F
F
, F
, F
, F
4 F
, F
14) A creditor is any person who has an ownership interest in a business.
F F F F F F F F F F F F F F
Answer: FALSE FF F
Explanation: A creditor is any person to whom money is owed. FF F F F F F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
,
Financia and Manageria Accounting: Financia F F F
Chapters, 7e (Miller-Nobles)
Chapter F:1 Accounting and the Business
Environment
Learning Objective F:1-1
1) Accounting is the information system that measures business activities, processes the
F F F F F F F F F
information into F F
reports, and communicates the results to decision makers.
F F F F F F F FF
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
2) Critical thinking and judgment skills are not necessary for accountants because
F F F F F F F F F F F F
technology has made F F F
the activities routine.
F F F
Answer: FALSE FF F
Explanation: Technology plays an important supporting role in performing routine
FF F F F F F F F F F
accounting F
functions. This allows accountants to have more time to focus on reviewing and evaluating
FF F F F F F F F F F F F F F
economic F
activities using critical thinking and judgment.
F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
3) Accounting starts with economic activities that accountants review and evaluate using
F F F F F F F F F F F F
critical thinking F F
and judgment to create useful information that helps individuals make good decisions.
F F F F F F F F F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
,AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
4) Accounting is referred to as the language of business because it is the method of
F F F F F F F F F F F F F F F F
communicating F
business information to decision makers.
F F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
F
F
, F FF Accounting The Financial Chapters 7th Edition Nobles, 2 F F F F F F F F
, F
5) A model called the ________ was created to help students and the public understand what
F F F F F F F F F F F F F F F F
accounting F
is. F
A) Decision Making Model
F F F F
B) Business Model
F F F
C) Pathways Vision Model
F F F F
D) Cost Model
F F F
Answer: C FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
6) The Pathways Vision Model emphasizes that good decisions have an impact on
F F F F F F F F F F F F F
A) accounting judgments and economic activity.
F F F F F F
B) accounting judgments only.
F F F F
C) economic activity only.
F F F F
D) neither accounting judgments nor economic activity.
F F F F F F F
Answer: A FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Why is Accounting Important? (H1)
FF F F F F F
F
,7) Managerial accounting focuses on providing information for external decision makers.
F F F F F F F F F F F
Answer: FALSE FF F
Explanation: Managerial accounting focuses on providing information for internal decision
FF F F F F F F F F F
makers. F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
8) Investors primarily use managerial accounting information for decision-making
F F F F F F F F F
purposes. F
Answer: FALSE FF F
Explanation: External users (investors) use financial accounting information.
FF F F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
F
F
, F
, F
, F
3 F
, F
9) A creditor is a person who owes money to the business.
F F F F F F F F F F F F
Answer: FALSE FF F
Explanation: A creditor is a person to whom a business owes money.
FF F F F F F F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
10) Income tax is calculated using accounting information.
F F F F F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement
F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
11) Financial accounting focuses on information for decision makers outside of the
F F F F F F F F F F F F
, business, such as F F F
creditors and taxing authorities. F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
12) Business owners use accounting information to set goals, evaluate progress toward
F F F F F F F F F F F F
those goals, and F F F
make adjustments when needed.
F F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
13) Outside investors ordinarily use financial accounting information to decide whether or
F F F F F F F F F F F F
not to invest F F F
in a business.
F F F
Answer: TRUE FF F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
F
F
, F
, F
, F
4 F
, F
14) A creditor is any person who has an ownership interest in a business.
F F F F F F F F F F F F F F
Answer: FALSE FF F
Explanation: A creditor is any person to whom money is owed. FF F F F F F F F F F F
Diff: 1 F F
LO: F:1-1 FF F
AACSB: Application of knowledge FF F F F
AICPA Functional: Measurement F FF F
PE Question Type: Concept
F F FF F
H2: Decision Makers: The Users of Accounting Information
FF F F F F F F F
F
