Test Bank – Financial Accounting Fundamentals, 8th Edition (Wild) | Complete Exam and Practice Question Set

DOWNLOAD THE Test Bank for Financial Accounting Fundamentals 8th
Edition Wild
Financial Accounting Fundamentals 8th Edition by Wild
CH01
TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.
1) Accounting is an information and measurement system that identifies, records, and
communicates an organization's business activities.
1) ______

⊚ true
⊚ false


2) Accounting includes the analysis and interpretation of information.
2) ______

⊚ true
⊚ false


3) Financial accounting focuses on the needs of external users, who get accounting
information from general-purpose financial statements.
3) ______

⊚ true
⊚ false


4) Internal users of accounting information do not directly manage the organization and
have limited access to its accounting information.
4) ______

⊚ true
⊚ false


5) Auditors verify the effectiveness of internal controls.
5) ______

⊚ true
⊚ false


6) External auditors examine financial statements to verify that they are prepared according
to generally accepted accounting principles.


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Financial Accounting Fundamentals 8th Edition by Wild
CH01
6) ______

⊚ true
⊚ false


7) External users include lenders, shareholders, customers, and regulators.
7) ______

⊚ true
⊚ false


8) Internal users include lenders, shareholders, brokers and nonexecutive employees.
8) ______

⊚ true
⊚ false


9) Opportunities in accounting include auditing, consulting, market research, and tax
planning.
9) ______

⊚ true
⊚ false


10) The fraud triangle shows that three factors that push a person to commit fraud are
opportunity, pressure, and rationalization.
10) ______

⊚ true
⊚ false


11) Internal controls are procedures to protect assets, ensure reliable accounting, promote
efficiency, and uphold company policies.
11) ______

⊚ true
⊚ false


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Financial Accounting Fundamentals 8th Edition by Wild
CH01

12) A partnership is a business owned by two or more people.
12) ______

⊚ true
⊚ false


13) Owners of a corporation are called shareholders or stockholders.
13) ______

⊚ true
⊚ false


14) In a partnership, the owners are called stockholders.
14) ______

⊚ true
⊚ false


15) The balance sheet shows a company's net income or loss over a period of time.

15) ______

⊚ true
⊚ false


16) The Financial Accounting Standards Board (FASB) is given the task of setting generally
accepted accounting principles (GAAP) from the Securities and Exchange Commission.
16) ______

⊚ true
⊚ false


17) The business entity assumption means that accounting information presumes that the
business will continue operating instead of being closed or sold.
17) ______


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, DOWNLOAD THE Test Bank for Financial Accounting Fundamentals 8th
Edition Wild
Financial Accounting Fundamentals 8th Edition by Wild
CH01
⊚ true
⊚ false


18) GAAP wants information to have relevance and faithful representation.

18) ______

⊚ true
⊚ false


19) The business entity assumption means that a business is accounted for separately from
other business entities and its owner(s).

19) ______

⊚ true
⊚ false


20) Revenues should not be recognized in the accounting records when earned, but rather
when cash is received.

20) ______

⊚ true
⊚ false


21) Specific accounting principles are basic assumptions, concepts, and guidelines for
preparing financial statements and arise out of long-used accounting practice.
21) ______

⊚ true
⊚ false


22) A sole proprietorship is a business with multiple owners.
22) ______




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