TESTBANKFORACCOUNTING,25TH ED
k k k k k
ITION
,Chapter 1--Introduction to Accounting and Business
k k k k k
Student:k
1. Thekmainkobjectivekofkaknot-for-
profitkbusinesskisknotktokmakekakprofit.kTrue False
2. Ankexamplekofkankexternalkuserkofkaccountingkinformationkiskthekfederalkgovernment.k
True False
3. Akcorporationkiskakbusinesskthatkisklegallykseparatekandkdistinctkfromkitskowners.k
True False
4. Aboutk90%kofkthekbusinesseskinkthekUnitedkStateskarekorganizedkaskcorporations.k
True False
5. Thekrolekofkaccountingkisktokprovidekmanykdifferentkuserskwithkfinancialkinformationktokmakekeconomickd
ecisions.
True False
6. Proprietorshipskarekownedkbykonekownerkandkprovidekonlykservicesktoktheirkcustomers.k
True False
7. OnlyklargekcompaniesksuchkaskWal-
Mart,kJCP,kGeneralkMotors,kandkthekBankkofkAmericakcankbekorganizedkaskcorporations.
True False
8. Accountingkinformationkuserskneedkreportskaboutkthekeconomickactivitieskandkconditionkofkbusinesses.k
True False
,9. Seniorkexecutiveskcannotkbekcriminallykprosecutedkforkthekwrongkdoingsktheykcommitkonkbehalfkofkthekc
ompanieskwherektheykwork.
True False
10. Thekprimarykrolekofkaccountingkisktokdeterminekthekamountkofktaxeskakbusinesskwillkbekrequiredktokpayktokta
xingkentities.
True False
11. Ankaccountkreceivablekisktypicallykclassifiedkaskakrevenue.k
True False
12. Managerialkaccountingkinformationkiskusedkbykexternalkandkinternalkuserskequally.k
True False
13. Financialkaccountingkprovideskinformationktokallkusers,kwhilekthekmainkfocuskforkmanagerialkaccountingkisktokp
rovidekinformationktokthekmanagement.
True False
14. Properkethicalkconductkimplieskthatkyoukonlykconsiderkwhat'skinkyourkbestkinterest.k
True False
15. Somekofkthekmajorkfraudulentkactskbykseniorkexecutiveskstartedkaskwhatktheykconsideredktokbeksmallkethicalkl
apseskwhichkgrewkoutkofkcontrol.
True False
16. Twokfactorskthatktypicallykleadktokethicalkviolationskarekrelevancekandktimelinesskofkaccountingkinformation.k
True False
17. Akbusinesskiskankorganizationkinkwherekbasickresourceskorkinputs,klikekmaterialskandklabor,karekassembledkandkp
rocessedktokprovidekoutputskinkthekformkofkgoodskorkservicesktokcustomers.
True False
, 18. ThekFinancialkAccountingkStandardskBoardk(FASB)kiskthekauthoritativekbodykthatkhaskprimarykresponsibilitykf
orkdevelopingkaccountingkprinciples.
True False
19. Thekcostkconceptkiskthekbasiskforkenteringkthekexchangekpricekintokthekaccountingkrecords.k
True False
20. Thekunitkofkmeasurementkconceptkrequireskthatkeconomickdatakbekrecordedkinkakcommonkunitkofk
measurement.
True False
21. Ifkakbuildingkiskappraisedkfork$85,000,kofferedkforksalekatk$90,000,kandkthekbuyerkpaysk$80,000kcashkforkit,kthekb
uyerkwouldkrecordkthekbuildingkatk$85,000.
True False
22. Generallykacceptedkaccountingkprincipleskregulatekhowkandkwhatkfinancialkinformationkiskreportedkbyk
businesses.
True False
23. ThekaccountingkequationkcankbekexpressedkaskAssetsk-
kLiabilitiesk=kOwner'skEquity.kTrue False
24. Thekrightskorkclaimsktokthekassetskofkakbusinesskmaykbeksubdividedkintokrightskofkcreditorskandkrightskofko
wners.
True False
25. Thekowner’skrightsktokthekassetskrankkaheadkofkthekcreditors'krightsktokthekassets.k
True False
26. Ifkthekliabilitieskowedkbykakbusinessktotalk$300,000kandkownerskequitykiskequalktok$300,000,kthenkthekassetskal
soktotalk$300,000.
True False
k k k k k
ITION
,Chapter 1--Introduction to Accounting and Business
k k k k k
Student:k
1. Thekmainkobjectivekofkaknot-for-
profitkbusinesskisknotktokmakekakprofit.kTrue False
2. Ankexamplekofkankexternalkuserkofkaccountingkinformationkiskthekfederalkgovernment.k
True False
3. Akcorporationkiskakbusinesskthatkisklegallykseparatekandkdistinctkfromkitskowners.k
True False
4. Aboutk90%kofkthekbusinesseskinkthekUnitedkStateskarekorganizedkaskcorporations.k
True False
5. Thekrolekofkaccountingkisktokprovidekmanykdifferentkuserskwithkfinancialkinformationktokmakekeconomickd
ecisions.
True False
6. Proprietorshipskarekownedkbykonekownerkandkprovidekonlykservicesktoktheirkcustomers.k
True False
7. OnlyklargekcompaniesksuchkaskWal-
Mart,kJCP,kGeneralkMotors,kandkthekBankkofkAmericakcankbekorganizedkaskcorporations.
True False
8. Accountingkinformationkuserskneedkreportskaboutkthekeconomickactivitieskandkconditionkofkbusinesses.k
True False
,9. Seniorkexecutiveskcannotkbekcriminallykprosecutedkforkthekwrongkdoingsktheykcommitkonkbehalfkofkthekc
ompanieskwherektheykwork.
True False
10. Thekprimarykrolekofkaccountingkisktokdeterminekthekamountkofktaxeskakbusinesskwillkbekrequiredktokpayktokta
xingkentities.
True False
11. Ankaccountkreceivablekisktypicallykclassifiedkaskakrevenue.k
True False
12. Managerialkaccountingkinformationkiskusedkbykexternalkandkinternalkuserskequally.k
True False
13. Financialkaccountingkprovideskinformationktokallkusers,kwhilekthekmainkfocuskforkmanagerialkaccountingkisktokp
rovidekinformationktokthekmanagement.
True False
14. Properkethicalkconductkimplieskthatkyoukonlykconsiderkwhat'skinkyourkbestkinterest.k
True False
15. Somekofkthekmajorkfraudulentkactskbykseniorkexecutiveskstartedkaskwhatktheykconsideredktokbeksmallkethicalkl
apseskwhichkgrewkoutkofkcontrol.
True False
16. Twokfactorskthatktypicallykleadktokethicalkviolationskarekrelevancekandktimelinesskofkaccountingkinformation.k
True False
17. Akbusinesskiskankorganizationkinkwherekbasickresourceskorkinputs,klikekmaterialskandklabor,karekassembledkandkp
rocessedktokprovidekoutputskinkthekformkofkgoodskorkservicesktokcustomers.
True False
, 18. ThekFinancialkAccountingkStandardskBoardk(FASB)kiskthekauthoritativekbodykthatkhaskprimarykresponsibilitykf
orkdevelopingkaccountingkprinciples.
True False
19. Thekcostkconceptkiskthekbasiskforkenteringkthekexchangekpricekintokthekaccountingkrecords.k
True False
20. Thekunitkofkmeasurementkconceptkrequireskthatkeconomickdatakbekrecordedkinkakcommonkunitkofk
measurement.
True False
21. Ifkakbuildingkiskappraisedkfork$85,000,kofferedkforksalekatk$90,000,kandkthekbuyerkpaysk$80,000kcashkforkit,kthekb
uyerkwouldkrecordkthekbuildingkatk$85,000.
True False
22. Generallykacceptedkaccountingkprincipleskregulatekhowkandkwhatkfinancialkinformationkiskreportedkbyk
businesses.
True False
23. ThekaccountingkequationkcankbekexpressedkaskAssetsk-
kLiabilitiesk=kOwner'skEquity.kTrue False
24. Thekrightskorkclaimsktokthekassetskofkakbusinesskmaykbeksubdividedkintokrightskofkcreditorskandkrightskofko
wners.
True False
25. Thekowner’skrightsktokthekassetskrankkaheadkofkthekcreditors'krightsktokthekassets.k
True False
26. Ifkthekliabilitieskowedkbykakbusinessktotalk$300,000kandkownerskequitykiskequalktok$300,000,kthenkthekassetskal
soktotalk$300,000.
True False
