Financial Accounting 6th Edition Test Bank by David Spiceland, Wayne Thomas & Don Herrmann – Questions & Answers 2026

TESTBANK b




FinancialAccounting,6thEdition
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Chapters1–12Complete
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By David Spiceland, WayneThomasandDonHerrmann
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,TABLEOFCONTENTS b b b




Chapter1:AFrameworkforFinancialAccounting Chapter2:The
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AccountingCycle:DuringthePeriod Chapter3:TheAccountingCycle:
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EndofthePeriod Chapter4:CashandInternalControls
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Chapter5:ReceivablesandSales
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Chapter6:InventoryandCostofGoodsSold Chapter7:Long-TermAssets
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Chapter8:CurrentLiabilities Chapter9:Long-
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TermLiabilities Chapter10:Stockholders’Equity
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b Chapter11:StatementofCashFlows
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Chapter12:FinancialStatementAnalysis
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,Chapter1 AFrameworkforFinancialAccounting
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1) Accountingisasystem ofmaintaining recordsofacompany'soperationsandcommunicating
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bthatinformation todecisionmakers.
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Answer:TRUE b




Difficulty:1Easy
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Topic: DefiningAccounting
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LearningObjective: 01-01Describethetwoprimaryfunctionsoffinancialaccounting.Bloom's:
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bRemember
AACSB:ReflectiveThinkingb b




AICPA: BBCritical Thinking
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2) Accountinginformation isusedbyinvestorstodecide whethertoinvestinacompany'sstock.
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Answer:TRUE b




Difficulty:1Easy
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Topic: DefiningAccounting
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LearningObjective: 01-01Describethetwoprimaryfunctionsoffinancialaccounting.Bloom's:
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bRemember
AACSB:ReflectiveThinkingb b




AICPA: BBCritical Thinking
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3) Accountinginformation isusedbycreditorstodecide whethertoinvestinacompany'sstock.
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Answer: FALSE b




Explanation: Creditorslend money toacompany. b b b b b b




Difficulty:1Easy
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Topic: DefiningAccounting
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LearningObjective: 01-01Describethetwoprimaryfunctionsoffinancialaccounting.Bloom's:
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bRemember
AACSB:ReflectiveThinkingb b




AICPA: BBCritical Thinking
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4) Theprimaryfunctionsof financialaccountingaretomeasurebusinessactivitiesofacompany
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andtocommunicatethosemeasurementstointernal partiesfordecision-makingpurposes.
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Answer: FALSE b




Explanation:Financialaccounting primarilyservestoprovide informationto externalparties.
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bDifficulty:2Medium b b




Topic: DefiningAccounting
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LearningObjective: 01-01Describethetwoprimaryfunctionsoffinancialaccounting.Bloom's:
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bUnderstand
AACSB:ReflectiveThinkingb b




AICPA: BBCritical Thinking
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, 5) Financingactivitiesaretransactionsinvolvingexternalsourcesoffunding.
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Answer:TRUE b




Difficulty:1Easy
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Topic: MeasuringBusinessActivities
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LearningObjective: 01-02Understandthebusinessactivitiesthatfinancialaccountingmeasures.
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bBloom's: Remember AACSB:
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ReflectiveThinkingAICPA: FN b b




Measurement
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6) Investingactivitiesincludethepurchaseandsaleoflong-termresources.
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Answer:TRUE b




Difficulty:1Easy
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Topic: MeasuringBusinessActivities
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LearningObjective: 01-02Understandthebusinessactivitiesthatfinancialaccountingmeasures.
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bBloom's: Remember AACSB:
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ReflectiveThinkingAICPA: FN b b




Measurement
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7) Operatingactivities includetransactionsthatrelatetotheprimaryoperationsofthecompany.
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Answer:TRUE b




Difficulty:1Easy
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Topic: MeasuringBusinessActivities
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LearningObjective: 01-02Understandthebusinessactivitiesthatfinancialaccountingmeasures.
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bBloom's: Remember AACSB:
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ReflectiveThinkingAICPA: FN b b




Measurement
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8) Acorporation isanentity thatislegally separate fromitsowners.
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Answer:TRUE b




Difficulty:1Easy
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Topic: MeasuringBusinessActivities
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LearningObjective: 01-02Understandthebusinessactivitiesthatfinancialaccountingmeasures.
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bBloom's: Remember AACSB:
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ReflectiveThinkingAICPA: BB b b




CriticalThinking
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