,DOWNLOAD THE Test Bank for Financial Accounting 9th Edition Libby
f f f f f f f f f
Chapter 02 f f
Investing and Financing Decisions and the Accounting System
f f f f f f f
Truef/fFalsefQuestions
1. Thefprimaryfobjectivefofffinancialfreportingfisftofprovidefusefulfinformationftofexternalfdecisionfma
kers.
True False
2. Inforderfforfinformationftofbefrelevant,fthefinformationfneedsftofbefcomplete,fneutral,fandffreeffromferror
.
True False
3. Inforderfforfinformationftofbefrelevant,fthefinformationfshouldfhavefbothfpredictivefand/orffeedbackfvalu
e.
True False
4. Thefcontinuityfassumptionfstatesfthatfafbusinessfwillfcontinueftofoperatefintofthefforeseeableffuture.
True False
5. Thefcurrentfassetsfsectionfoffafbalancefsheetfincludesfbothfinventoryfandfprepaidfexpenses.
True False
2-1
Copyrightf©f2017fMcGraw-HillfEducation.fAllfrightsfreserved.fNofreproductionforfdistributionfwithoutfthefpriorfwrittenfconsentfoffMcGraw-
HillfEducation.
mynursytest.store
,DOWNLOAD THE Test Bank for Financial Accounting 9th Edition Libby
f f f f f f f f f
6. Thefstockholders'fequityfsectionfoffafbalancefsheetfincludesfcapitalfcontributedfbyfownersfandfalsofretai
nedfearnings.
True False
7. Underfthefmonetaryfunitfassumption,faccountingfinformationfshouldfbefmeasuredfandfreportedfinfter
msfoffthefnationalfmonetaryfunit,fwithfanfadjustmentfforfchangesfinfpurchasingfpower.
True False
8. Assetsfarefreportedfonfthefbalancefsheetfinftheforderfoffliquidity.
True False
9. Manyfvaluablefintangiblefassetsfsuchfasftrademarksfandfcopyrightsfarefnotfreportedfonfafcompany'sfbala
ncefsheet.
True False
10. Stockholders'fequityfreflectsftheffinancingfprovidedfbyfowners.
True False
11. Commonfstockfandfadditional-paidfinfcapitalfrepresentftheffinancingfsourcesffromfshareholders.
True False
12. Financialfreportingffocusesfonfreportingfthefimpactfofftransactionsfonfanfentity'sffinancialfposition.
True False
13. Unearnedfrevenuefisfreportedfonfthefbalancefsheetfasfafliabilityfandfrepresentsfamountsfpaidftofanfentity
f infexchangefforffuturefservicesfand/orfgoods.
True False
2-2
Copyrightf©f2017fMcGraw-HillfEducation.fAllfrightsfreserved.fNofreproductionforfdistributionfwithoutfthefpriorfwrittenfconsentfoffMcGraw-
HillfEducation.
mynursytest.store
, DOWNLOAD THE Test Bank for Financial Accounting 9th Edition Libby
f f f f f f f f f
14. Aftransactionfmayfbefanfexchangefoffassetsforfservicesfbyfonefbusinessfforfassets,fservices,forfprom
isesftofpayffromfafdifferentfbusiness.
True False
15. Thefdualfeffectsfconceptfimpliesfthatfeveryftransactionfhasfatfleastftwofeffectsfonfthefaccountingfequa
tion.
True False
16. Thefaccountingfequationfdoesfnotfhaveftofbefinfbalancefafterfthefrecordingfoffeachftransaction.
True False
17. Additional-paidfinfcapitalfisfreportedfonfthefbalancefsheetfasfafcomponentfoffshareholders'fequity.
True False
18. Commonfstockfandfadditional-
paidfinfcapitalfarefbothfreportedfonfthefbalancefsheetfasfcomponentsfoffshareholders'fequity.
True False
19. Afcompany'sfassetsfandfstockholders'fequityfbothfincreasefwhenfthefcompanyfsellsfadditionalfsharesfoffst
ockfinfexchangefforfcash.
True False
20. Purchasingfsuppliesfforfcashfresultsfinfanfincreasefinftotalfassetsfforfthefpurchasingfcompany.
True False
21. Thefnormalfbalancefforfanfassetfaccountfisfafdebitfandfthefnormalfbalancefforfafliabilityfaccountfisfafcredit.
True False
2-3
Copyrightf©f2017fMcGraw-HillfEducation.fAllfrightsfreserved.fNofreproductionforfdistributionfwithoutfthefpriorfwrittenfconsentfoffMcGraw-
HillfEducation.
mynursytest.store
f f f f f f f f f
Chapter 02 f f
Investing and Financing Decisions and the Accounting System
f f f f f f f
Truef/fFalsefQuestions
1. Thefprimaryfobjectivefofffinancialfreportingfisftofprovidefusefulfinformationftofexternalfdecisionfma
kers.
True False
2. Inforderfforfinformationftofbefrelevant,fthefinformationfneedsftofbefcomplete,fneutral,fandffreeffromferror
.
True False
3. Inforderfforfinformationftofbefrelevant,fthefinformationfshouldfhavefbothfpredictivefand/orffeedbackfvalu
e.
True False
4. Thefcontinuityfassumptionfstatesfthatfafbusinessfwillfcontinueftofoperatefintofthefforeseeableffuture.
True False
5. Thefcurrentfassetsfsectionfoffafbalancefsheetfincludesfbothfinventoryfandfprepaidfexpenses.
True False
2-1
Copyrightf©f2017fMcGraw-HillfEducation.fAllfrightsfreserved.fNofreproductionforfdistributionfwithoutfthefpriorfwrittenfconsentfoffMcGraw-
HillfEducation.
mynursytest.store
,DOWNLOAD THE Test Bank for Financial Accounting 9th Edition Libby
f f f f f f f f f
6. Thefstockholders'fequityfsectionfoffafbalancefsheetfincludesfcapitalfcontributedfbyfownersfandfalsofretai
nedfearnings.
True False
7. Underfthefmonetaryfunitfassumption,faccountingfinformationfshouldfbefmeasuredfandfreportedfinfter
msfoffthefnationalfmonetaryfunit,fwithfanfadjustmentfforfchangesfinfpurchasingfpower.
True False
8. Assetsfarefreportedfonfthefbalancefsheetfinftheforderfoffliquidity.
True False
9. Manyfvaluablefintangiblefassetsfsuchfasftrademarksfandfcopyrightsfarefnotfreportedfonfafcompany'sfbala
ncefsheet.
True False
10. Stockholders'fequityfreflectsftheffinancingfprovidedfbyfowners.
True False
11. Commonfstockfandfadditional-paidfinfcapitalfrepresentftheffinancingfsourcesffromfshareholders.
True False
12. Financialfreportingffocusesfonfreportingfthefimpactfofftransactionsfonfanfentity'sffinancialfposition.
True False
13. Unearnedfrevenuefisfreportedfonfthefbalancefsheetfasfafliabilityfandfrepresentsfamountsfpaidftofanfentity
f infexchangefforffuturefservicesfand/orfgoods.
True False
2-2
Copyrightf©f2017fMcGraw-HillfEducation.fAllfrightsfreserved.fNofreproductionforfdistributionfwithoutfthefpriorfwrittenfconsentfoffMcGraw-
HillfEducation.
mynursytest.store
, DOWNLOAD THE Test Bank for Financial Accounting 9th Edition Libby
f f f f f f f f f
14. Aftransactionfmayfbefanfexchangefoffassetsforfservicesfbyfonefbusinessfforfassets,fservices,forfprom
isesftofpayffromfafdifferentfbusiness.
True False
15. Thefdualfeffectsfconceptfimpliesfthatfeveryftransactionfhasfatfleastftwofeffectsfonfthefaccountingfequa
tion.
True False
16. Thefaccountingfequationfdoesfnotfhaveftofbefinfbalancefafterfthefrecordingfoffeachftransaction.
True False
17. Additional-paidfinfcapitalfisfreportedfonfthefbalancefsheetfasfafcomponentfoffshareholders'fequity.
True False
18. Commonfstockfandfadditional-
paidfinfcapitalfarefbothfreportedfonfthefbalancefsheetfasfcomponentsfoffshareholders'fequity.
True False
19. Afcompany'sfassetsfandfstockholders'fequityfbothfincreasefwhenfthefcompanyfsellsfadditionalfsharesfoffst
ockfinfexchangefforfcash.
True False
20. Purchasingfsuppliesfforfcashfresultsfinfanfincreasefinftotalfassetsfforfthefpurchasingfcompany.
True False
21. Thefnormalfbalancefforfanfassetfaccountfisfafdebitfandfthefnormalfbalancefforfafliabilityfaccountfisfafcredit.
True False
2-3
Copyrightf©f2017fMcGraw-HillfEducation.fAllfrightsfreserved.fNofreproductionforfdistributionfwithoutfthefpriorfwrittenfconsentfoffMcGraw-
HillfEducation.
mynursytest.store
