Test Bank :
b b
Horngren’s Accounting The Financial Chapters
b b b b
14th Edition Miller-Nobles Mattison Complete
b b b b b
Guide Financial Accounting Exam Prep PDF
b b b b b b
1
,Horngren's Accounting:The Financial Chapters, 14e (Miller-Nobles)
b b b b b b
Chapter F:1 Accounting and the Business Environment
b b b b b
Learning Objective F:1-1 b b
1) Accounting is the information system that measures business activities, processes the information into
b b b b b b b b b b b b
reports, and communicates the results to decision makers.
b b b b b b b b
Answer: TRUE b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
2) The knowledge of accounting is rarely used to help make business and personal financial decisions.
b b b b b b b b b b b b b b
Answer: FALSE
b b
Explanation: The knowledge of accounting is used daily to assist in making decisions for both businesses and
b b b b b b b b b b b b b b b b
personal items.
b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
3) Accounting starts with economic activities that accountants review and evaluate using critical thinking
b b b b b b b b b b b b
and judgment to create useful information that helps individuals make good decisions.
b b b b b b b b b b b b
Answer: TRUE b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
4) Accounting is referred to as the language of business because it is the method of communicating
b b b b b b b b b b b b b b b
business information to decision makers.
b b b b b
Answer: TRUE b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
2
,3
, 5) A model called the
b b b was created to help students and the public understand what accounting is.
b b b b b b b b b b b
A) Decision Making Model b b
B) Business Model b
C) Pathways Vision Model b b
D) Cost Model b
Answer: C
b b
Diff: 1
b b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
6) The Pathways Vision Model emphasizes that good decisions have an impact on
b b b b b b b b b b b .
A) accounting judgments and economic activity b b b b
B) accounting judgments only b b
C) economic activity only b b
D) neither accounting judgments nor economic activity
b b b b b
Answer: A
b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
7) Managerial accounting focuses on providing information for external decision makers.
b b b b b b b b b
Answer: FALSE
b b
Explanation: Managerial accounting focuses on providing information for internal decision makers.
b b b b b b b b b b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Decision Makers: The Users of Accounting Information
b b b b b b b b
8) Investors primarily use managerial accounting information for decision-making purposes.
b b b b b b b b
Answer: FALSE
b b
Explanation: External users (investors) use financial accounting information.
b b b b b b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Decision Makers: The Users of Accounting Information
b b b b b b b b
4
b b
Horngren’s Accounting The Financial Chapters
b b b b
14th Edition Miller-Nobles Mattison Complete
b b b b b
Guide Financial Accounting Exam Prep PDF
b b b b b b
1
,Horngren's Accounting:The Financial Chapters, 14e (Miller-Nobles)
b b b b b b
Chapter F:1 Accounting and the Business Environment
b b b b b
Learning Objective F:1-1 b b
1) Accounting is the information system that measures business activities, processes the information into
b b b b b b b b b b b b
reports, and communicates the results to decision makers.
b b b b b b b b
Answer: TRUE b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
2) The knowledge of accounting is rarely used to help make business and personal financial decisions.
b b b b b b b b b b b b b b
Answer: FALSE
b b
Explanation: The knowledge of accounting is used daily to assist in making decisions for both businesses and
b b b b b b b b b b b b b b b b
personal items.
b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
3) Accounting starts with economic activities that accountants review and evaluate using critical thinking
b b b b b b b b b b b b
and judgment to create useful information that helps individuals make good decisions.
b b b b b b b b b b b b
Answer: TRUE b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
4) Accounting is referred to as the language of business because it is the method of communicating
b b b b b b b b b b b b b b b
business information to decision makers.
b b b b b
Answer: TRUE b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
2
,3
, 5) A model called the
b b b was created to help students and the public understand what accounting is.
b b b b b b b b b b b
A) Decision Making Model b b
B) Business Model b
C) Pathways Vision Model b b
D) Cost Model b
Answer: C
b b
Diff: 1
b b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
6) The Pathways Vision Model emphasizes that good decisions have an impact on
b b b b b b b b b b b .
A) accounting judgments and economic activity b b b b
B) accounting judgments only b b
C) economic activity only b b
D) neither accounting judgments nor economic activity
b b b b b
Answer: A
b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Why is Accounting Important? (H1)
b b b b b b b
7) Managerial accounting focuses on providing information for external decision makers.
b b b b b b b b b
Answer: FALSE
b b
Explanation: Managerial accounting focuses on providing information for internal decision makers.
b b b b b b b b b b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Decision Makers: The Users of Accounting Information
b b b b b b b b
8) Investors primarily use managerial accounting information for decision-making purposes.
b b b b b b b b
Answer: FALSE
b b
Explanation: External users (investors) use financial accounting information.
b b b b b b b
Diff: 1 b
LO: F:1-1
b b
AACSB: Application of knowledge b b b
AICPA Functional: Measurement
b b b
PE Question Type: Concept
b b b b
H2 : Decision Makers: The Users of Accounting Information
b b b b b b b b
4
