TESTBANKFORACCOUNTING,25TH ED
p p p p p
ITION
,Chapter 1--Introduction to Accounting and Business
p p p p p
Student:p
1. Thepmainpobjectivepofpapnot-for-
profitpbusinesspispnotptopmakepapprofit.pTrue False
2. Anpexamplepofpanpexternalpuserpofpaccountingpinformationpispthepfederalpgovernment.p
True False
3. Apcorporationpispapbusinesspthatpisplegallypseparatepandpdistinctpfrompitspowners.p
True False
4. Aboutp90%pofpthepbusinessespinpthepUnitedpStatespareporganizedpaspcorporations.p
True False
5. Theprolepofpaccountingpisptopprovidepmanypdifferentpuserspwithpfinancialpinformationptopmakepeconomicpd
ecisions.
True False
6. Proprietorshipsparepownedpbyponepownerpandpprovideponlypservicesptoptheirpcustomers.p
True False
7. OnlyplargepcompaniespsuchpaspWal-
Mart,pJCP,pGeneralpMotors,pandpthepBankpofpAmericapcanpbeporganizedpaspcorporations.
True False
8. Accountingpinformationpuserspneedpreportspaboutpthepeconomicpactivitiespandpconditionpofpbusinesses.p
True False
,9. Seniorpexecutivespcannotpbepcriminallypprosecutedpforpthepwrongpdoingsptheypcommitponpbehalfpofpthepc
ompaniespwhereptheypwork.
True False
10. Thepprimaryprolepofpaccountingpisptopdeterminepthepamountpofptaxespapbusinesspwillpbeprequiredptoppayptopta
xingpentities.
True False
11. Anpaccountpreceivablepisptypicallypclassifiedpaspaprevenue.p
True False
12. Managerialpaccountingpinformationpispusedpbypexternalpandpinternalpuserspequally.p
True False
13. Financialpaccountingpprovidespinformationptopallpusers,pwhilepthepmainpfocuspforpmanagerialpaccountingpisptopp
rovidepinformationptopthepmanagement.
True False
14. Properpethicalpconductpimpliespthatpyouponlypconsiderpwhat'spinpyourpbestpinterest.p
True False
15. Somepofpthepmajorpfraudulentpactspbypseniorpexecutivespstartedpaspwhatptheypconsideredptopbepsmallpethicalpl
apsespwhichpgrewpoutpofpcontrol.
True False
16. Twopfactorspthatptypicallypleadptopethicalpviolationspareprelevancepandptimelinesspofpaccountingpinformation.p
True False
17. Apbusinesspispanporganizationpinpwherepbasicpresourcesporpinputs,plikepmaterialspandplabor,parepassembledpandpp
rocessedptopprovidepoutputspinpthepformpofpgoodsporpservicesptopcustomers.
True False
, 18. ThepFinancialpAccountingpStandardspBoardp(FASB)pispthepauthoritativepbodypthatphaspprimarypresponsibilitypf
orpdevelopingpaccountingpprinciples.
True False
19. Thepcostpconceptpispthepbasispforpenteringpthepexchangeppricepintopthepaccountingprecords.p
True False
20. Thepunitpofpmeasurementpconceptprequirespthatpeconomicpdatapbeprecordedpinpapcommonpunitpofp
measurement.
True False
21. Ifpapbuildingpispappraisedpforp$85,000,pofferedpforpsalepatp$90,000,pandpthepbuyerppaysp$80,000pcashpforpit,pthepb
uyerpwouldprecordpthepbuildingpatp$85,000.
True False
22. Generallypacceptedpaccountingpprinciplespregulatephowpandpwhatpfinancialpinformationpispreportedpbyp
businesses.
True False
23. ThepaccountingpequationpcanpbepexpressedpaspAssetsp-
pLiabilitiesp=pOwner'spEquity.pTrue False
24. Theprightsporpclaimsptopthepassetspofpapbusinesspmaypbepsubdividedpintoprightspofpcreditorspandprightspofpo
wners.
True False
25. Thepowner’sprightsptopthepassetsprankpaheadpofpthepcreditors'prightsptopthepassets.p
True False
26. Ifpthepliabilitiespowedpbypapbusinessptotalp$300,000pandpownerspequitypispequalptop$300,000,pthenpthepassetspal
soptotalp$300,000.
True False
p p p p p
ITION
,Chapter 1--Introduction to Accounting and Business
p p p p p
Student:p
1. Thepmainpobjectivepofpapnot-for-
profitpbusinesspispnotptopmakepapprofit.pTrue False
2. Anpexamplepofpanpexternalpuserpofpaccountingpinformationpispthepfederalpgovernment.p
True False
3. Apcorporationpispapbusinesspthatpisplegallypseparatepandpdistinctpfrompitspowners.p
True False
4. Aboutp90%pofpthepbusinessespinpthepUnitedpStatespareporganizedpaspcorporations.p
True False
5. Theprolepofpaccountingpisptopprovidepmanypdifferentpuserspwithpfinancialpinformationptopmakepeconomicpd
ecisions.
True False
6. Proprietorshipsparepownedpbyponepownerpandpprovideponlypservicesptoptheirpcustomers.p
True False
7. OnlyplargepcompaniespsuchpaspWal-
Mart,pJCP,pGeneralpMotors,pandpthepBankpofpAmericapcanpbeporganizedpaspcorporations.
True False
8. Accountingpinformationpuserspneedpreportspaboutpthepeconomicpactivitiespandpconditionpofpbusinesses.p
True False
,9. Seniorpexecutivespcannotpbepcriminallypprosecutedpforpthepwrongpdoingsptheypcommitponpbehalfpofpthepc
ompaniespwhereptheypwork.
True False
10. Thepprimaryprolepofpaccountingpisptopdeterminepthepamountpofptaxespapbusinesspwillpbeprequiredptoppayptopta
xingpentities.
True False
11. Anpaccountpreceivablepisptypicallypclassifiedpaspaprevenue.p
True False
12. Managerialpaccountingpinformationpispusedpbypexternalpandpinternalpuserspequally.p
True False
13. Financialpaccountingpprovidespinformationptopallpusers,pwhilepthepmainpfocuspforpmanagerialpaccountingpisptopp
rovidepinformationptopthepmanagement.
True False
14. Properpethicalpconductpimpliespthatpyouponlypconsiderpwhat'spinpyourpbestpinterest.p
True False
15. Somepofpthepmajorpfraudulentpactspbypseniorpexecutivespstartedpaspwhatptheypconsideredptopbepsmallpethicalpl
apsespwhichpgrewpoutpofpcontrol.
True False
16. Twopfactorspthatptypicallypleadptopethicalpviolationspareprelevancepandptimelinesspofpaccountingpinformation.p
True False
17. Apbusinesspispanporganizationpinpwherepbasicpresourcesporpinputs,plikepmaterialspandplabor,parepassembledpandpp
rocessedptopprovidepoutputspinpthepformpofpgoodsporpservicesptopcustomers.
True False
, 18. ThepFinancialpAccountingpStandardspBoardp(FASB)pispthepauthoritativepbodypthatphaspprimarypresponsibilitypf
orpdevelopingpaccountingpprinciples.
True False
19. Thepcostpconceptpispthepbasispforpenteringpthepexchangeppricepintopthepaccountingprecords.p
True False
20. Thepunitpofpmeasurementpconceptprequirespthatpeconomicpdatapbeprecordedpinpapcommonpunitpofp
measurement.
True False
21. Ifpapbuildingpispappraisedpforp$85,000,pofferedpforpsalepatp$90,000,pandpthepbuyerppaysp$80,000pcashpforpit,pthepb
uyerpwouldprecordpthepbuildingpatp$85,000.
True False
22. Generallypacceptedpaccountingpprinciplespregulatephowpandpwhatpfinancialpinformationpispreportedpbyp
businesses.
True False
23. ThepaccountingpequationpcanpbepexpressedpaspAssetsp-
pLiabilitiesp=pOwner'spEquity.pTrue False
24. Theprightsporpclaimsptopthepassetspofpapbusinesspmaypbepsubdividedpintoprightspofpcreditorspandprightspofpo
wners.
True False
25. Thepowner’sprightsptopthepassetsprankpaheadpofpthepcreditors'prightsptopthepassets.p
True False
26. Ifpthepliabilitiespowedpbypapbusinessptotalp$300,000pandpownerspequitypispequalptop$300,000,pthenpthepassetspal
soptotalp$300,000.
True False
