Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
Accounting -
correct answer ✅A system that collects and processes financial
information about an organization and reports that information to
decision makers.
External Decision makers -
correct answer ✅Deal with financial accounting system (focus of
Accounting 284)
Balance Sheet (BS), Statement of Retained Earnings (SRE),
Statement of Cash Flows (SCF), and the Income Statement (IS) -
correct answer ✅4 Things provided by a financial accounting
system
Balance Sheet -
correct answer ✅Reports the financial position of an accounting
entity AT A POINT IN TIME. Also called the "statement of financial
position". Reports assets, liabilities, and stockholders' equity.
Assets=Liabilities+Stockholders' Equity -
correct answer ✅Balance Sheet Equation
,Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
Statement of Retained Earnings -
correct answer ✅Reports how net income and the distribution of
dividends affected the financial position of the company FOR THIS
ACCOUNTING PERIOD.
Beginning RE + Net Income - Dividends = Ending RE -
correct answer ✅Retained Earnings Equation
Income Statement -
correct answer ✅Reports revenues less expenses for the
accounting period. Shows net income (aka net profit, net earnings,
the bottom line). Also called "statement of income", "statement of
earnings", and "statement of operations".
Revenue - Expenses = Net Income -
correct answer ✅Income Statement Equation
Statement of Cash Flows -
correct answer ✅Reports inflows and outflows of cash DURING
THE ACCOUNTING PERIOD. Provides information about cash flows
not provided by ACCRUAL-BASED net income. Reports cash flows
from operating, investing and financing activities.
,Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
Cash flows from operating activities + Cash flows from investing
activities + Cash flows from financing activities = Change in cash -
correct answer ✅Statement of Cash Flows Equation
Income statement equation and retained earnings equation. -
correct answer ✅Net income is in what two equations?
Retained earnings equation and balance sheet equation (goes into
stockholders equity along with contributed capital. -
correct answer ✅Ending RE goes into what two equations?
Contributed Capital and Retained Earnings. -
correct answer ✅Two factors that go into stockholders equity.
1. Describe accounting rules used
2. Provides detail of specific items on the financial statements.
3. Disclose information not shown on the financial Statements. -
correct answer ✅Three types of financial statements
GAAP (Generally Accepted Accounting Principles) -
correct answer ✅The measurement rules used to develop the
information in the financial statements. Consists of SEC, FASB,
PCAOB.
, Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
SEC -
correct answer ✅The federal agency with the power to determine
the rules.
FASB -
correct answer ✅The private body that actually writes the rules.
(Body that currently writes U.S. accounting rules)
PCAOB -
correct answer ✅The body that approves the rules
Relevant, faithful representation, comparable, verifiable, timely,
understandable. -
correct answer ✅Qualitative Characteristics of Accounting
Information
Management -
correct answer ✅Who is primarily responsible for the information
contained in the financial statements.
Sole proprietorship, partnership, corporation -
correct answer ✅3 types of business entities
Questions And Answers Latest Update
Accounting -
correct answer ✅A system that collects and processes financial
information about an organization and reports that information to
decision makers.
External Decision makers -
correct answer ✅Deal with financial accounting system (focus of
Accounting 284)
Balance Sheet (BS), Statement of Retained Earnings (SRE),
Statement of Cash Flows (SCF), and the Income Statement (IS) -
correct answer ✅4 Things provided by a financial accounting
system
Balance Sheet -
correct answer ✅Reports the financial position of an accounting
entity AT A POINT IN TIME. Also called the "statement of financial
position". Reports assets, liabilities, and stockholders' equity.
Assets=Liabilities+Stockholders' Equity -
correct answer ✅Balance Sheet Equation
,Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
Statement of Retained Earnings -
correct answer ✅Reports how net income and the distribution of
dividends affected the financial position of the company FOR THIS
ACCOUNTING PERIOD.
Beginning RE + Net Income - Dividends = Ending RE -
correct answer ✅Retained Earnings Equation
Income Statement -
correct answer ✅Reports revenues less expenses for the
accounting period. Shows net income (aka net profit, net earnings,
the bottom line). Also called "statement of income", "statement of
earnings", and "statement of operations".
Revenue - Expenses = Net Income -
correct answer ✅Income Statement Equation
Statement of Cash Flows -
correct answer ✅Reports inflows and outflows of cash DURING
THE ACCOUNTING PERIOD. Provides information about cash flows
not provided by ACCRUAL-BASED net income. Reports cash flows
from operating, investing and financing activities.
,Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
Cash flows from operating activities + Cash flows from investing
activities + Cash flows from financing activities = Change in cash -
correct answer ✅Statement of Cash Flows Equation
Income statement equation and retained earnings equation. -
correct answer ✅Net income is in what two equations?
Retained earnings equation and balance sheet equation (goes into
stockholders equity along with contributed capital. -
correct answer ✅Ending RE goes into what two equations?
Contributed Capital and Retained Earnings. -
correct answer ✅Two factors that go into stockholders equity.
1. Describe accounting rules used
2. Provides detail of specific items on the financial statements.
3. Disclose information not shown on the financial Statements. -
correct answer ✅Three types of financial statements
GAAP (Generally Accepted Accounting Principles) -
correct answer ✅The measurement rules used to develop the
information in the financial statements. Consists of SEC, FASB,
PCAOB.
, Accounting 284 Exam 1 Iowa State
Questions And Answers Latest Update
SEC -
correct answer ✅The federal agency with the power to determine
the rules.
FASB -
correct answer ✅The private body that actually writes the rules.
(Body that currently writes U.S. accounting rules)
PCAOB -
correct answer ✅The body that approves the rules
Relevant, faithful representation, comparable, verifiable, timely,
understandable. -
correct answer ✅Qualitative Characteristics of Accounting
Information
Management -
correct answer ✅Who is primarily responsible for the information
contained in the financial statements.
Sole proprietorship, partnership, corporation -
correct answer ✅3 types of business entities
