ACG 4101 Quiz Questions and Answers
2026
Which of the following is not a potential advantage of accrual accounting over cash
basis accounting?
A) Spreads out the influence of one-time events that affect multiple reporting periods.
B) Highlights the performance for a period of time.
C) Captures underlying economic activity more timely.
D) Better matching of revenues and expenses. - answer Highlights the performance for
a period of time.
The Financial Accounting Standards Board (FASB)
A) Is a division of the Securities and Exchange Commission (SEC).
B) Is a private body that helps set accounting standards in the United States.
C) Is responsible for setting auditing standards that all auditors must follow.
D) Consists entirely of members of the American Institute of Certified Public
Accountants. - answerIs a private body that helps set accounting standards in the
United States.
Which of the following is not a provision of the Public Company Accounting Reform and
Investor Protection Act of 2002 (Sarbanes-Oxley)? The Act:
A. Required that auditors assess the effectiveness of all internal control processes
B. Increased corporate executive responsibility for financial statements
C. Limited non-audit services that can be performed by auditors for audit clients
D. Changed the entity responsible for setting auditing standards - answerRequired that
auditors assess the effectiveness of all internal control processes
Which of the following is not a component of faithful representation as defined in the
FASB's conceptual framework?
a. Free from error.
b. Neutrality.
c. Understandability.
d. Completeness. - answerUnderstandability.
2026
Which of the following is not a potential advantage of accrual accounting over cash
basis accounting?
A) Spreads out the influence of one-time events that affect multiple reporting periods.
B) Highlights the performance for a period of time.
C) Captures underlying economic activity more timely.
D) Better matching of revenues and expenses. - answer Highlights the performance for
a period of time.
The Financial Accounting Standards Board (FASB)
A) Is a division of the Securities and Exchange Commission (SEC).
B) Is a private body that helps set accounting standards in the United States.
C) Is responsible for setting auditing standards that all auditors must follow.
D) Consists entirely of members of the American Institute of Certified Public
Accountants. - answerIs a private body that helps set accounting standards in the
United States.
Which of the following is not a provision of the Public Company Accounting Reform and
Investor Protection Act of 2002 (Sarbanes-Oxley)? The Act:
A. Required that auditors assess the effectiveness of all internal control processes
B. Increased corporate executive responsibility for financial statements
C. Limited non-audit services that can be performed by auditors for audit clients
D. Changed the entity responsible for setting auditing standards - answerRequired that
auditors assess the effectiveness of all internal control processes
Which of the following is not a component of faithful representation as defined in the
FASB's conceptual framework?
a. Free from error.
b. Neutrality.
c. Understandability.
d. Completeness. - answerUnderstandability.
