Test bank for Financial Accounting, 6th Edition By David Spiceland, Wayne Thomas and Don Herrmann

TESTBANK l




Financial Accounting, 6th Edition
ll ll l




Chapters 1 – 12 Complete
ll ll ll ll




By David Spiceland, Wayne Thomas and Don Herrmann
ll ll ll ll ll ll ll

,TABLEOFCONTENTS l l ll




Chapter 1:A Framework for Financial Accounting Chapter 2:The
l l l l l l l l l l




Accounting Cycle: During the Period Chapter 3: The Accounting Cycle:
l l l l l l l l l l l




End of the Period Chapter 4: Cash and Internal Controls
ll l l l l l l l l l l




Chapter 5: Receivables and Sales
l l l l




Chapter 6: Inventory and Cost of Goods Sold Chapter7: Long-Term
l l ll l l ll l l l l l




Assets
l




Chapter8: Current Liabilities Chapter9: Long-
l l l ll l l l l




Term Liabilities Chapter10:Stockholders’Equity
l l l l l l




l l Chapter 11: Statement of Cash Flows
l l l ll l




Chapter12:FinancialStatementAnalysis
l l l l

,Chapter 1 A Framework for Financial Accounting
ll l l ll ll ll ll




1) Accounting is a system of maintaining records of a company's operations and communicating
l ll ll ll l ll l ll ll l ll ll



that information to decision makers.
l l ll ll ll ll




Answer: TRUE l



Difficulty:1Easy
ll l l



Topic: Defining Accounting
l l l



Learning Objective: 01-01 Describe the two primary functions of financial accounting.Bloom's:
l l l l ll l l l l l ll



l Rememberl



AACSB: Reflective Thinking l ll



AICPA: BB Critical Thinking
l l l l l ll




2) Accounting information is used by investors to decide whether to invest in a company's stock.
l ll l ll ll l l ll ll ll l ll ll l




Answer: TRUE l



Difficulty:1Easy
ll l l



Topic: Defining Accounting
l l l



Learning Objective: 01-01 Describe the two primary functions of financial accounting.Bloom's:
l l l l ll l l l l l ll



l Rememberl



AACSB: Reflective Thinking l ll



AICPA: BB Critical Thinking
l l l l l ll




3) Accounting information is used by creditors to decide whether to invest in a company's stock.
l ll l ll ll l l ll l ll ll ll l l




Answer: FALSE l l



Explanation: Creditors lend money to a company. ll ll ll ll ll ll



Difficulty: 1 Easy
l l ll ll



Topic: Defining Accounting
l l l



Learning Objective: 01-01 Describe the two primary functions of financial accounting.Bloom's:
l l l l ll l l l l l ll



l Rememberl



AACSB: Reflective Thinking l ll



AICPA: BB Critical Thinking
l l l l l ll




4) The primary functions of financial accounting are to measure business activities of a company
ll ll ll ll ll ll ll ll ll ll ll ll ll



and to communicate those measurements to internal parties for decision-making purposes.
l l ll ll l ll ll ll ll l ll ll




Answer: FALSE l l



Explanation: Financial accounting primarily serves to provide information to external parties.
ll ll ll ll ll ll ll ll ll ll



lDifficulty: 2 Medium
l l l



Topic: Defining Accounting
l l l



Learning Objective: 01-01 Describe the two primary functions of financial accounting.Bloom's:
l l l l ll l l ll l l ll



l Understand
l



AACSB: Reflective Thinking l ll



AICPA: BB Critical Thinking
l l l l l ll

, 5) Financing activities are transactions involving external sources of funding.
l ll l ll ll ll l l




Answer: TRUE l



Difficulty:1Easy
ll l l



Topic: Measuring Business Activities
l l l l



Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
l l l l l l l ll l l



l Bloom's: Remember AACSB:
l ll l l ll



ReflectiveThinkingAICPA: FN l l l



Measurement
l




6) Investing activities include the purchase and sale of long-term resources.
l ll l ll l l l l l




Answer: TRUE l



Difficulty:1Easy
ll l l



Topic: Measuring Business Activities
l l l l



Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
l l l l l l l ll l l



l Bloom's: Remember AACSB:
l ll l l ll



ReflectiveThinkingAICPA: FN l l l



Measurement
l




7) Operating activities include transactions that relate to the primary operations of the company.
l ll ll ll ll ll ll ll ll l l ll




Answer: TRUE l



Difficulty:1Easy
ll l l



Topic: Measuring Business Activities
l l l l



Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
l l l l l l l ll l l



l Bloom's: Remember AACSB:
l ll l l ll



ReflectiveThinkingAICPA: FN l l l



Measurement
l




8) A corporation is an entity that is legally separate from its owners.
ll ll l ll ll ll l ll ll ll ll




Answer: TRUE l



Difficulty:1Easy
ll l l



Topic: Measuring Business Activities
l l l l



Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
l l l l l l l ll l l



l Bloom's: Remember AACSB:
l ll l l ll



Reflective ThinkingAICPA: BB l l l



Critical Thinking
l ll