ACCT 212 Week 1 Exam Questions with Verified Solutions Rated A+

ACCT 212 Week 1 Exam Questions with Verified Solutions Rated A+ users of accounting information rely on financial statement analysis to make more informed decisions when pursuing their goals. - Answers External Identify which of the following specific areas are considered the building blocks of financial statement analysis. (Check all that apply.) - Answers Solvency Liquidity and efficiency Market prospects Profitability Most users rely on financial statements, which include the (1) income statement, (2) balance sheet, (3) statement of stockholders' equity, (4) statement of cash flows, and (5) notes to these statements. - Answers General Purpose A measurement of key relations between financial statement items is called _______ analysis. - Answers Ratio The purpose of financial statement analysis for (internal/external) users is to provide information to improve efficiency and effectiveness. - Answers internal Comparative financial statements show financial information in _____ columns. - Answers Side-by-side Which of the following areas are not considered to be one of the building blocks of financial statement analysis? - Answers Ratio analysis ________ analysis is a form of horizontal analysis that can reveal patterns in data across periods by comparing period amounts by base period amounts. Multiple choice question. - Answers Trend Most users rely on general-purpose financial statements, which include which of the following? (Check all that apply.) - Answers Income statement Statement of cash flows Notes to financial statements Balance sheet Statement of stockholders' equity Vertical analysis is a tool to evaluate individual financial statement items or a group of items. When analyzing income statement accounts, the base is usually (revenue/expenses/net income) and for balance sheet accounts, the base is usually total (assets/liabilities/equity) . - Answers Revenue Assets When analyzing income statement accounts, the base is usually _____ - Answers Revenue When analyzing balance sheet accounts, the base is usually _____ - Answers total Assets All of the following are standards used in financial statement analysis for comparisons: - Answers industry competitor intracompany A comparison of a company's financial condition and performance across time is called _______ analysis. - Answers horizontal financial statements express each item as a percent of a base amount. The base amount is assigned a value of 100%. - Answers Common-Size ______ financial statements show financial amounts in side-by-side columns on a single statement. - Answers comparative Trend percent is computed by taking the (analysis period amount ________) x 100. - Answers divided by the base period Data visualizations reveal: (Check all that apply). - Answers insights not easily seen by looking at numbers trends not easily seen by looking at numbers What types of information does managerial accounting provide? (Check all that apply.) - Answers Information for managers Non-financial Financial According to the fraud triangle, the three factors that must exist for a person to commit fraud include __, __, and __. (Check all that apply). - Answers pressure or incentive rationalization opportunity Consider a company that manufactures picture frames. Which of the following costs would be considered direct costs? (Check all that apply.) - Answers Glass used in the frame Oak wood used for frame Wages of assembly line worker Direct materials costs for an automobile manufacturer would include all of the following: - Answers tires bumpers steering wheels True or false: The main purpose of managerial accounting is to provide general-purpose financial statements. - Answers False Managerial accounting has the following characteristics? (Check all that apply.) - Answers Emphasis is on projects, processes, and divisions Focus is on internal users Includes mostly monetary and some nonmonetary information An employee that is having trouble paying his personal bills might exhibit the following fraud factor: - Answers Pressure