A100 Exam 2 Test Questions All
Answered Correct 2025-2026 Updated.
Financial Accounting - Answer The field of accounting that focuses on providing information
for external decision makers.
Finance Activities - Answer raising money through creditors and investors
Operating activities - Answer Paying salaries, wages, rent, utilities, stuff that makes the
business operate
Investing Activities - Answer Purchasing land, buildings and equipment to operate
Equity investors - Answer Shareholders of a company who hope to receive dividends and for
the stock price to increase, but they may also be hurt if the company is not successful and the
stock price drops
Debt investors - Answer -Creditors of the business, such as a bank
-Principal must be repaid
-Interest must be paid
to default on a loan - Answer failure to pay back a loan
Securities and Exchange Commission (SEC) - Answer Maintain truthful and fair capital markets
Form 10-K - Answer the annual report that publicly traded companies must file with the SEC,
includes balance sheet, income statement, statement of stockholders equity and statement of
cash flows
Form 10Q - Answer quarterly unaudited financial reports covering the most current quarter
Audit - Answer A thorough review of the financial statements to express an opinion on them.
Lends credibility to the financial statements
, internal auditors - Answer auditors employed by a company to audit for the company's board
of directors and management
FASB (Financial Accounting Standards Board) - Answer The primary accounting standard-
setting body in the United States.
Generally Accepted Accounting Principles (GAAP) - Answer a set of accounting standards that
is used in the preparation of financial statements
Conceptual Framework of Accounting - Answer the collection of concepts that guide the
manner in which accounting is practiced
International Financial Reporting Standards (IFRS) - Answer Accounting standards, issued by
the IASB, that have been adopted by many countries outside of the United States. Less specific
than GAAP
reporting entities - Answer organizations that prepare financial statements
income taxes - Answer tax levied by a government directly on income, especially an annual tax
on personal income.
C Corporation - Answer The most common type of corporation, which is a legal business entity
that offers limited liability to all of its owners, who are called stockholders
Corporate Tax Formula - Answer Gross income - Deductions = Taxable Income x Tax Rates (21%
for C-corps) = Income tax liability + other taxes - credits - prepayments = Taxes due (or refund)
double taxation - Answer taxation of dividends both as corporate profit and as personal
income
capital market - Answer networks for raising money
Independent Auditors - Answer follow established auditing standards to assess the fairness of
the financial statements and related presentations
Answered Correct 2025-2026 Updated.
Financial Accounting - Answer The field of accounting that focuses on providing information
for external decision makers.
Finance Activities - Answer raising money through creditors and investors
Operating activities - Answer Paying salaries, wages, rent, utilities, stuff that makes the
business operate
Investing Activities - Answer Purchasing land, buildings and equipment to operate
Equity investors - Answer Shareholders of a company who hope to receive dividends and for
the stock price to increase, but they may also be hurt if the company is not successful and the
stock price drops
Debt investors - Answer -Creditors of the business, such as a bank
-Principal must be repaid
-Interest must be paid
to default on a loan - Answer failure to pay back a loan
Securities and Exchange Commission (SEC) - Answer Maintain truthful and fair capital markets
Form 10-K - Answer the annual report that publicly traded companies must file with the SEC,
includes balance sheet, income statement, statement of stockholders equity and statement of
cash flows
Form 10Q - Answer quarterly unaudited financial reports covering the most current quarter
Audit - Answer A thorough review of the financial statements to express an opinion on them.
Lends credibility to the financial statements
, internal auditors - Answer auditors employed by a company to audit for the company's board
of directors and management
FASB (Financial Accounting Standards Board) - Answer The primary accounting standard-
setting body in the United States.
Generally Accepted Accounting Principles (GAAP) - Answer a set of accounting standards that
is used in the preparation of financial statements
Conceptual Framework of Accounting - Answer the collection of concepts that guide the
manner in which accounting is practiced
International Financial Reporting Standards (IFRS) - Answer Accounting standards, issued by
the IASB, that have been adopted by many countries outside of the United States. Less specific
than GAAP
reporting entities - Answer organizations that prepare financial statements
income taxes - Answer tax levied by a government directly on income, especially an annual tax
on personal income.
C Corporation - Answer The most common type of corporation, which is a legal business entity
that offers limited liability to all of its owners, who are called stockholders
Corporate Tax Formula - Answer Gross income - Deductions = Taxable Income x Tax Rates (21%
for C-corps) = Income tax liability + other taxes - credits - prepayments = Taxes due (or refund)
double taxation - Answer taxation of dividends both as corporate profit and as personal
income
capital market - Answer networks for raising money
Independent Auditors - Answer follow established auditing standards to assess the fairness of
the financial statements and related presentations
