FINANCIAL ACCOUNTING (6TH EDITION) – ROBERT LIBBY & PATRICIA LIBBY – COMPLETE TEST BANK FOR CHAPTERS 1–14 WITH TRUE-FALSE QUESTIONS AND ASSESSMENT MATERIAL A+ VERIFIED

Test Bank For Financial Accounting 6th Edition by Robert Libby
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, Patricia Libby ISBN NO: 978-0073526881 All Chapters 1-
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14 Complete jh

, Chapter 001: Financial Statements and Business Decisions
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Truejh/jhFalsejhQuestions


1. Accountingjhisjhajhsystemjhthatjhcollectsjhandjhprocessesjhfinancialjhinformationjhaboutjha
njhorganizationjhandjhreportsjhthatjhinformationjhtojhdecisionjhmakers.
TRUE

AACSBjhTag:jhCommunicationsj h Di
fficulty:jhEasy
L.O.:jh1



2. Assetsjhonjhthejhbalancejhsheetjharejhrecordedjhatjhmarketjhvaluejhorjhreplacementjhcost.
FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhEasy
L.O.:jh1



3. Injhaccountingjhandjhreportingjhforjhajhbusinessjhentity,jhthejhaccountingjhandjhreportingjhforjht
hejhbusinessjhmustjhbejhkeptjhseparatejhfromjhotherjheconomicjhaffairsjhofjhitsjhowners.
TRUE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhEasy
L.O.:jh1



4. Thejhaccountingjhperiodjhinjhwhichjhservicejhrevenuejhisjhrecognizedjh(i.e.,jhrevenuejhforjhservic
esjhrendered)jhisjhgenerallyjhthejhperiodjhinjhwhichjhthejhcashjhisjhcollected.
FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhMedium
L.O.:jh1




1-1

, Chapter 001: Financial Statements and Business Decisions
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5. Totaljhassetsjharejh$70,000,jhtotaljhliabilities,jh$40,000jhandjhcontributedjhcapitaljhisjh$20,00
0;jhtherefore,jhretainedjhearningsjharejh$15,000.
FALSE


AACSBjhTag:jhAnalyti
cj h Difficulty:jhMediu
mj h L.O.:jh1



6. Thejhpaymentjhofjhajhcashjhdividendjhtojhstockholdersjhincreasesjhstockholders'jhequity.
FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhMedium
L.O.:jh1



7. Thejhaccountingjhmodeljhforjhthejhbalancejhsheetjhis:jhAssetsjh+jhLiabilitiesjh=jhStockholders'jhEquity.
FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhEasy
L.O.:jh1



8. Ajhdecisionjhmakerjhwhojhwantsjhtojhunderstandjhajhcompany'sjhfinancialjhstatementsjhmustjhcarefull
yjhreadjhthejhnotesjhtojhthejhfinancialjhstatementsjhbecausejhthejhnotesjhprovidejhusefuljhsupplementaljhi
nformation.
TRUE


AACSBjhTag:jhCommunicationsj h Di
fficulty:jhEasy
L.O.:jh1




1-2

, Chapter 001: Financial Statements and Business Decisions
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9. Thejhfinancialjhstatementjhthatjhshowsjhanjhentity'sjheconomicjhresourcesjhandjhitsjhliabilitiesjh
isjhthejhstatementjhofjhcashjhflows.
FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhMedium
L.O.:jh1



10. Companiesjhpreparejhfinancialjhstatementsjhatjhthejhendjhofjheachjhyearjhandjhmorejhoftenjhasjhneeded.
TRUE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhEasy
L.O.:jh1



11. Ajhnotejhpayablejhisjhajhborrowingjhinstrumentjhthatjhgenerallyjhdoesjhnotjhinvolvejhthejhpaymentjh
ofjhinterest.
FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhHard
L.O.:jh1



12. Thejhamountjhofjhcashjhpaidjhbyjhajhbusinessjhforjhofficejhutilitiesjhwouldjhbejhreportedjhonjht
hejhstatementjhofjhcashjhflowsjhasjhanjhoperatingjhactivity.
TRUE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhHard
L.O.:jh1



13. ThejhincomejhstatementjhequationjhisjhExpensesj h Revenuesjh=jhNetjhIncome.
jh

FALSE


AACSBjhTag:jhReflectivejhThinkingj h
Difficulty:jhEasy
L.O.:jh1




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