Test bank, Mock questions : Principles of Accounting, Chapters 1-21,Pollard,1e [2026 Update]

Principles of Accounting (Pollard)
Chapter 1 Accounting and the Business Environment


1)
Profit is the difference between the amount earned frоm customers for goods sold or services provided by the
business and the amount incurred to operate the business.
Answer:


True

False
Diff: 1
Page Ref: 4
Objective: 1.1

2)
For most businesses, profit is NOT a goal of the organization.
Answer:
True



False
Diff: 1
Page Ref: 4
Objective: 1.1

3)
Аn architectural firm is an example of a service organization.
Answer:


True

False
Diff: 1
Page Ref: 4
Objective: 1.1

4)
A Target department store is an example of a service organization.
Answer:
True



False
Diff: 1
Page Ref: 4
Objective: 1.1

5)
Merchandise or retail companies sell products that are made by another supplier.
Answer:


True

False
Diff: 2
Page Ref: 4

, Objective: 1.1

6)
Apple and Honda are examples of manufacturing companies.
Answer:


True

False
Diff: 1
Page Ref: 4
Objective: 1.1

7)
A corporation's оwners are called shareholders.
Answer:


True

False
Diff: 2
Page Ref: 4
Objective: 1.1

8)
A weakness of the corporate form of a business is unlimited liability of owners.
Аnswer:
True



False
Diff: 2
Page Ref: 4
Objectivе: 1.1

9)
The life of a sole proprietorship is limited to the owner's choice or death.
Answer:


True

False
Diff: 2
Page Ref: 4
Objective: 1.1

, 10)
A corporation is a separatе legal entity from its owners.
Answer:


True

False
Diff: 2
Page Ref: 4
Objective: 1.1

11)
Orgаnization acсountability is the organization's fiduciary responsibility to manage the resources of an
organization.
Answer:


True

False
Diff: 2
Page Ref: 5
Objective: 1.2

12)
Shаreholders are any group who has an interest in an organization.
Answer:
True



False
Diff: 2
Page Ref: 5
Objective: 1.2

13)
Investors, emplоyees, suppliers, creditors and government agencies are examples of stakeholders.
Answer:


True

False
Diff: 2
Page Ref: 5
Objective: 1.2

14)
Stakeholders use accounting information to make decisions about invеsting, operating and financing activities.
Answer:


True

False
Diff: 2
Page Ref: 5
Objective: 1.2

15)
Financial accounting produces financial information and reports to be used ОNLY by managers inside a business.
Answer:

, True



False