,
,TEST BANK FOR M! M!
Financial Accounting 6th Edition by David Spiceland, Wayne Thomas, Don He
M! M! M! M! M! M! M! M! M! M!
rrmann
Chapter 1 M! A Framework for Financial Accounting
M! M! M! M!
1) Accounting is a system of maintaining records of a company's operations and communica
M! M! M! M! M! M! M! M! M! M! M! M!
ting that information to decision makers.
M! M! M! M! M!
Answer: TRUE Di M ! M!
fficulty: 1 Easy
M! M!
Topic: Defining Accounting M!
Learning Objective: 01-
M!
01 Describe the two primary functions of financial accounting. Bloom's:
M! M! M! M! M! M! M! M! M!
Remember
AACSB:
Reflective Thinking M! M
AICPA:
!
BB Critical Thinkin M! M!
g
2) Accounting information is used by investors to decide whether to invest in a company's stock.
M! M! M! M! M! M! M! M! M! M! M! M! M! M!
Answer: TRUE Di M ! M!
fficulty: 1 Easy
M! M!
Topic: Defining Accounting M!
Learning Objective: 01-
M!
01 Describe the two primary functions of financial accounting. Bloom's:
M! M! M! M! M! M! M! M! M!
Remember
AACSB:
Reflective Thinking M! M
AICPA:
!
BB Critical Thinkin M! M!
g
3) Accounting information is used by creditors to decide whether to invest in a company's stock.
M! M! M! M! M! M! M! M! M! M! M! M! M! M!
Answer: FALSE M ! M !
Explanation:
Creditors lend money to a compan M! M! M! M! M!
y. Difficulty: 1 Easy
M! M! M!
Topic: Defining Accounting M!
Learning Objective: 01-
M!
01 Describe the two primary functions of financial accounting. Bloom's:
M! M! M! M! M! M! M! M! M!
Remember
AACSB:
Reflective Thinking M! M
AICPA:
!
BB Critical Thinkin M! M!
g
, 4) The primary functions of financial accounting are to measure business activities of a com
M! M! M! M! M! M! M! M! M! M! M! M! M!
pany and to communicate those measurements to internal parties for decision-
M! M! M! M! M! M! M! M! M! M!
making purposes.
M!
Answer: FALSE M ! M !
Explanation:
Financial accounting primarily serves to provide information to external parti
M! M! M! M! M! M! M! M! M!
es. Difficulty: 2 Medium
M! M! M!
Topic: Defining Accounting M!
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
M! M! M! M! M! M! M! M! M!
,TEST BANK FOR M! M!
Financial Accounting 6th Edition by David Spiceland, Wayne Thomas, Don He
M! M! M! M! M! M! M! M! M! M!
rrmann
Chapter 1 M! A Framework for Financial Accounting
M! M! M! M!
1) Accounting is a system of maintaining records of a company's operations and communica
M! M! M! M! M! M! M! M! M! M! M! M!
ting that information to decision makers.
M! M! M! M! M!
Answer: TRUE Di M ! M!
fficulty: 1 Easy
M! M!
Topic: Defining Accounting M!
Learning Objective: 01-
M!
01 Describe the two primary functions of financial accounting. Bloom's:
M! M! M! M! M! M! M! M! M!
Remember
AACSB:
Reflective Thinking M! M
AICPA:
!
BB Critical Thinkin M! M!
g
2) Accounting information is used by investors to decide whether to invest in a company's stock.
M! M! M! M! M! M! M! M! M! M! M! M! M! M!
Answer: TRUE Di M ! M!
fficulty: 1 Easy
M! M!
Topic: Defining Accounting M!
Learning Objective: 01-
M!
01 Describe the two primary functions of financial accounting. Bloom's:
M! M! M! M! M! M! M! M! M!
Remember
AACSB:
Reflective Thinking M! M
AICPA:
!
BB Critical Thinkin M! M!
g
3) Accounting information is used by creditors to decide whether to invest in a company's stock.
M! M! M! M! M! M! M! M! M! M! M! M! M! M!
Answer: FALSE M ! M !
Explanation:
Creditors lend money to a compan M! M! M! M! M!
y. Difficulty: 1 Easy
M! M! M!
Topic: Defining Accounting M!
Learning Objective: 01-
M!
01 Describe the two primary functions of financial accounting. Bloom's:
M! M! M! M! M! M! M! M! M!
Remember
AACSB:
Reflective Thinking M! M
AICPA:
!
BB Critical Thinkin M! M!
g
, 4) The primary functions of financial accounting are to measure business activities of a com
M! M! M! M! M! M! M! M! M! M! M! M! M!
pany and to communicate those measurements to internal parties for decision-
M! M! M! M! M! M! M! M! M! M!
making purposes.
M!
Answer: FALSE M ! M !
Explanation:
Financial accounting primarily serves to provide information to external parti
M! M! M! M! M! M! M! M! M!
es. Difficulty: 2 Medium
M! M! M!
Topic: Defining Accounting M!
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
M! M! M! M! M! M! M! M! M!
