, Module 1 k
Financial Accounting for MBAs
k k k
LearningkObjectivesk–kCoveragekbykquestion
True/False MultiplekChoice
LO1k–
kExplainkandkassesskthekfourkmainkbusinesskactivitie
s.
LO2k–
1-k4 1,k2
kIdentifykandkdiscusskthekuserskandksupplierskofkfina
ncialkstatementkinformation.
LO3k–
5-10 3-19
kDescribekandkexaminekthekfourkfinancialkstatements
,kandkdefinekthekaccountingkequation.
LO4k–
11-13 20-25
kExplainkandkapplykthekbasicskofkprofitabilitykanalysis
.
LO5k–
14 26,k27
kAssesskbusinesskoperationskwithinkthekcontextkofkak
competitivekenvironment.
LO6k–
kAccesskreportskfiledkwithkthekSECk(Appendixk1A).
LO7k–
kDescribekthekaccountingkprincipleskandkregulationsk 15 28-30
thatkframekfinancialkstatementsk(Appendixk1B).
ThesekquestionskarekavailablektokassignkinkmyBusinessCourse.
,Modulek1:kFinancialkAccountingkforkMBAs
True/False
Topic:kUserskofkFinancialkStatementkInformationk
LO:k2
1. Shareholdersk demandkfinancialkinformationkprimarilyktokassesskprofitabilitykandkriskkwhereaskbankers
k demandkinformationkprimarilyktokassesskcashkflowsktokrepaykloankinterestkandkprincipal.
Answer:kTrue
Rationale:kWhilekbothkshareholderskandkbankerskarekinterestedkinkallkthekinformationkcompanieskpr
ovide,kshareholderskcarekaboutkmorekaboutkakcompany’skprofitabilitykandkbankerskcarekmorekabou
tksolvencykandkcreditworthiness.
Topic:kPubliclykAvailablekFinancialkReport
skLO:k2
2. Publiclyktradedkcompanieskarekrequiredktokprovidekquarterlykfinancialkreportskdirectlyktokthekpublic.
Answer:kFalse
Rationale:kCompanieskprovidekelectronickversionskofkquarterlykfinancialkstatementsktokthekSEC,kwhic
hk postskthemktokthekInternetkforkthekpublicktokaccesskthem.
Topic:kUserskofkFinancialkStatementkInformationk
LO:k2
3. PubliclyktradedkcompanieskprovidekfinancialkinformationkprimarilyktoksatisfykthekSECkandkthektaxkauthori
tiesk(thatkis,kthekInternalkRevenuekService).
Answer:kFalse
Rationale:kDemandkforkinformationkextendsktokmanykusers;kthekregulatorsksuchkaskthekSECkandkthe
kIRSkarekonlykonekclasskofkusers.
Topic:kSECkFiling
skLO:k2
4. PubliclyktradedkcompanieskmustkprovidektokthekSecuritieskExchangekCommissionkannualkauditedkfinan
cialkstatementsk(10-Kkreports)kandkquarterlykauditedkfinancialkstatementsk(10-Qkreports).
Answer:kFalse
Rationale:kQuarterlykreportskdoknotkneedktokbekaudited.
Topic:kBalancekShee
tkLO:k3
5. Ifkakcompanykreportskretainedkearningskofk$175.3kmillionkonkitskbalanceksheet,kitkmustkalsokreportk$1
75.3kmillionkinkcash.
Answer:kFalse
, Rationale:kThek accountingk equationk requiresk totalkassetsk tok equalktotalk liabilitiesk plusk stockholders
’kequity.kThatkdoesknotkimply,khowever,kthatkliabilitykandkequitykaccountskrelatekdirectlyktokspecifickass
ets.
Financial Accounting for MBAs
k k k
LearningkObjectivesk–kCoveragekbykquestion
True/False MultiplekChoice
LO1k–
kExplainkandkassesskthekfourkmainkbusinesskactivitie
s.
LO2k–
1-k4 1,k2
kIdentifykandkdiscusskthekuserskandksupplierskofkfina
ncialkstatementkinformation.
LO3k–
5-10 3-19
kDescribekandkexaminekthekfourkfinancialkstatements
,kandkdefinekthekaccountingkequation.
LO4k–
11-13 20-25
kExplainkandkapplykthekbasicskofkprofitabilitykanalysis
.
LO5k–
14 26,k27
kAssesskbusinesskoperationskwithinkthekcontextkofkak
competitivekenvironment.
LO6k–
kAccesskreportskfiledkwithkthekSECk(Appendixk1A).
LO7k–
kDescribekthekaccountingkprincipleskandkregulationsk 15 28-30
thatkframekfinancialkstatementsk(Appendixk1B).
ThesekquestionskarekavailablektokassignkinkmyBusinessCourse.
,Modulek1:kFinancialkAccountingkforkMBAs
True/False
Topic:kUserskofkFinancialkStatementkInformationk
LO:k2
1. Shareholdersk demandkfinancialkinformationkprimarilyktokassesskprofitabilitykandkriskkwhereaskbankers
k demandkinformationkprimarilyktokassesskcashkflowsktokrepaykloankinterestkandkprincipal.
Answer:kTrue
Rationale:kWhilekbothkshareholderskandkbankerskarekinterestedkinkallkthekinformationkcompanieskpr
ovide,kshareholderskcarekaboutkmorekaboutkakcompany’skprofitabilitykandkbankerskcarekmorekabou
tksolvencykandkcreditworthiness.
Topic:kPubliclykAvailablekFinancialkReport
skLO:k2
2. Publiclyktradedkcompanieskarekrequiredktokprovidekquarterlykfinancialkreportskdirectlyktokthekpublic.
Answer:kFalse
Rationale:kCompanieskprovidekelectronickversionskofkquarterlykfinancialkstatementsktokthekSEC,kwhic
hk postskthemktokthekInternetkforkthekpublicktokaccesskthem.
Topic:kUserskofkFinancialkStatementkInformationk
LO:k2
3. PubliclyktradedkcompanieskprovidekfinancialkinformationkprimarilyktoksatisfykthekSECkandkthektaxkauthori
tiesk(thatkis,kthekInternalkRevenuekService).
Answer:kFalse
Rationale:kDemandkforkinformationkextendsktokmanykusers;kthekregulatorsksuchkaskthekSECkandkthe
kIRSkarekonlykonekclasskofkusers.
Topic:kSECkFiling
skLO:k2
4. PubliclyktradedkcompanieskmustkprovidektokthekSecuritieskExchangekCommissionkannualkauditedkfinan
cialkstatementsk(10-Kkreports)kandkquarterlykauditedkfinancialkstatementsk(10-Qkreports).
Answer:kFalse
Rationale:kQuarterlykreportskdoknotkneedktokbekaudited.
Topic:kBalancekShee
tkLO:k3
5. Ifkakcompanykreportskretainedkearningskofk$175.3kmillionkonkitskbalanceksheet,kitkmustkalsokreportk$1
75.3kmillionkinkcash.
Answer:kFalse
, Rationale:kThek accountingk equationk requiresk totalkassetsk tok equalktotalk liabilitiesk plusk stockholders
’kequity.kThatkdoesknotkimply,khowever,kthatkliabilitykandkequitykaccountskrelatekdirectlyktokspecifickass
ets.
