TEST BANK
Financial Accounting, 6th Edition
Chapters 1 – 12 Complete
By David Spiceland, Wayne Thomas and Don Herrmann
,TABLE OF CONTENTS
Chapter v1: vA vFramework vfor vFinancial vAccounting v Chapter v2: vThe
vAccounting vCycle: vDuring vthe vPeriod v Chapter v3: vThe vAccounting
vCycle: vEnd vof vthe vPeriod v Chapter v4: vCash vand vInternal vControls
Chapter v5: vReceivables vand vSales
Chapter v6: vInventory vand vCost vof vGoods vSold v Chapter v7: vLong-
Term vAssets
Chapter v8: vCurrent vLiabilities v v Chapter v9:
vLong-Term vLiabilities v Chapter v10:
vStockholders’ vEquity v Chapter v11: vStatement
vof vCash vFlows
Chapter v12: vFinancial vStatement vAnalysis
,Chapter v1 v A vFramework vfor vFinancial vAccounting
1) Accounting vis va vsystem vof vmaintaining vrecords vof va vcompany's voperations vand
vcommunicating v that vinformation vto vdecision vmakers.
Answer: vTRUE
v Difficulty: v1 vEasy
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Remember
AACSB: vReflective vThinking
v AICPA: v BB vCritical
vThinking
2) Accounting vinformation vis vused vby vinvestors vto vdecide vwhether vto vinvest vin va vcompany's
vstock.
Answer: vTRUE
v Difficulty: v1 vEasy
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Remember
AACSB: vReflective vThinking
v AICPA: v BB vCritical
vThinking
3) Accounting vinformation vis vused vby vcreditors vto vdecide vwhether vto vinvest vin va vcompany's
vstock.
Answer: v FALSE
Explanation: vCreditors vlend vmoney vto va
vcompany. v Difficulty: v1 vEasy
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Remember
AACSB: vReflective vThinking
v AICPA: v BB vCritical
vThinking
4) The vprimary vfunctions vof vfinancial vaccounting vare vto vmeasure vbusiness vactivities vof va
vcompany v and vto vcommunicate vthose vmeasurements vto vinternal vparties vfor vdecision-making
vpurposes.
Answer: v FALSE
Explanation: vFinancial vaccounting vprimarily vserves vto vprovide vinformation vto vexternal
vparties. v Difficulty: v2 vMedium
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Understand
AACSB: vReflective vThinking
v AICPA: v BB vCritical
, vThinking
Financial Accounting, 6th Edition
Chapters 1 – 12 Complete
By David Spiceland, Wayne Thomas and Don Herrmann
,TABLE OF CONTENTS
Chapter v1: vA vFramework vfor vFinancial vAccounting v Chapter v2: vThe
vAccounting vCycle: vDuring vthe vPeriod v Chapter v3: vThe vAccounting
vCycle: vEnd vof vthe vPeriod v Chapter v4: vCash vand vInternal vControls
Chapter v5: vReceivables vand vSales
Chapter v6: vInventory vand vCost vof vGoods vSold v Chapter v7: vLong-
Term vAssets
Chapter v8: vCurrent vLiabilities v v Chapter v9:
vLong-Term vLiabilities v Chapter v10:
vStockholders’ vEquity v Chapter v11: vStatement
vof vCash vFlows
Chapter v12: vFinancial vStatement vAnalysis
,Chapter v1 v A vFramework vfor vFinancial vAccounting
1) Accounting vis va vsystem vof vmaintaining vrecords vof va vcompany's voperations vand
vcommunicating v that vinformation vto vdecision vmakers.
Answer: vTRUE
v Difficulty: v1 vEasy
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Remember
AACSB: vReflective vThinking
v AICPA: v BB vCritical
vThinking
2) Accounting vinformation vis vused vby vinvestors vto vdecide vwhether vto vinvest vin va vcompany's
vstock.
Answer: vTRUE
v Difficulty: v1 vEasy
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Remember
AACSB: vReflective vThinking
v AICPA: v BB vCritical
vThinking
3) Accounting vinformation vis vused vby vcreditors vto vdecide vwhether vto vinvest vin va vcompany's
vstock.
Answer: v FALSE
Explanation: vCreditors vlend vmoney vto va
vcompany. v Difficulty: v1 vEasy
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Remember
AACSB: vReflective vThinking
v AICPA: v BB vCritical
vThinking
4) The vprimary vfunctions vof vfinancial vaccounting vare vto vmeasure vbusiness vactivities vof va
vcompany v and vto vcommunicate vthose vmeasurements vto vinternal vparties vfor vdecision-making
vpurposes.
Answer: v FALSE
Explanation: vFinancial vaccounting vprimarily vserves vto vprovide vinformation vto vexternal
vparties. v Difficulty: v2 vMedium
Topic: v Defining vAccounting
Learning vObjective: v 01-01 vDescribe vthe vtwo vprimary vfunctions vof vfinancial
vaccounting.Bloom's: v Understand
AACSB: vReflective vThinking
v AICPA: v BB vCritical
, vThinking
