ACCOUNTING FOR DECISION MAKERS
- C213 Pre-Assessment Exam Questions
With 100% Correct Answers (Verified)
Latest Update 2025 Grade A+
Which of the following is NOT a service typically provided by large public accounting
firms?
Correct Answer: Making management decisions
The organization that develops worldwide accounting standards is the
Correct Answer: International Accounting Standards Board (IASB)
The initials CPA stand for
Correct Answer: Certified Public Accountant
Standards established by the International Accounting Standards Board are referred to
as
Correct Answer: International Financial Accounting Standards
Which of the following is NOT a reason for the integration of worldwide accounting
standards?
Correct Answer: the theoretical necessity of a common set of accounting standards
,The International Accounting Standards Board (IASB) is charged with developing
worldwide accounting practices
Correct Answer: True
With the current state of information technology, investors outside a company are now
allowed access to a company's internal database of financial information and do their
own customized analysis of a firm's performance.
Correct Answer: False
Increased federal oversight of the audit process resulted from the passage of the
following act of Congress
Correct Answer: Sarbanes-Oxley Act
Steps in the decision cycle from first (1) to last (5)
Correct Answer: Prepare financial statements
Analyze financial statements
Gather information
Make decision
Implement decision
What is the price-earnings (PE) ratio for this company?
Partial financial information for a company is as follows:
Current assets $36,543
,Total assets $58,719
Current liabilities $24,824
Total liabilities $48,561
Stockholders' equity $10,158
Sales $46,997
Net Income $ 3,761
Market value of shares $41,316
Correct Answer: 11.0
What does it mean if a company has a debt ratio of 101.5%?
Correct Answer: The company has 1.5% more total liabilities than total assets.
What is consistent with a continual decline in gross profit if the firm's cost of goods sold
remains the same?
Correct Answer: Continual decrease in sales
Which two cash flow adequacy ratios represent a cash cow?
Correct Answer: $6,991/$5,486 & $5,220/$1,875
What two items of information are revealed on the balance sheet?
Correct Answer: Ownership & Debt
Which term is defined as the residual interest in the net assets of a company?
, Correct Answer: Owners' equity
A corporation has total liabilities of $300 million, total owners' equity of $100 million, and
current assets of $50 million. What is the value of the firm's long-term assets?
Correct Answer: $350 million
Which situation should result in revenue recognition on the income statement for the
year ending 12/31/14 if the firm is using accrual-basis accounting?
Correct Answer: In 2014, a company provides services to a customer for which cash
will be collected the next year (2015).
Which category on the statement of cash flows summarizes cash receipts and
payments to owners and creditors of the company?
Correct Answer: Cash flows from financing activities
Cash flows from financing activities
Correct Answer: In the notes to financial statements
Which assurance does an external audit report provide for its readers?
Correct Answer: The company's financial statements fairly reflect its financial position
Information that can be verified
Correct Answer: Reliable
- C213 Pre-Assessment Exam Questions
With 100% Correct Answers (Verified)
Latest Update 2025 Grade A+
Which of the following is NOT a service typically provided by large public accounting
firms?
Correct Answer: Making management decisions
The organization that develops worldwide accounting standards is the
Correct Answer: International Accounting Standards Board (IASB)
The initials CPA stand for
Correct Answer: Certified Public Accountant
Standards established by the International Accounting Standards Board are referred to
as
Correct Answer: International Financial Accounting Standards
Which of the following is NOT a reason for the integration of worldwide accounting
standards?
Correct Answer: the theoretical necessity of a common set of accounting standards
,The International Accounting Standards Board (IASB) is charged with developing
worldwide accounting practices
Correct Answer: True
With the current state of information technology, investors outside a company are now
allowed access to a company's internal database of financial information and do their
own customized analysis of a firm's performance.
Correct Answer: False
Increased federal oversight of the audit process resulted from the passage of the
following act of Congress
Correct Answer: Sarbanes-Oxley Act
Steps in the decision cycle from first (1) to last (5)
Correct Answer: Prepare financial statements
Analyze financial statements
Gather information
Make decision
Implement decision
What is the price-earnings (PE) ratio for this company?
Partial financial information for a company is as follows:
Current assets $36,543
,Total assets $58,719
Current liabilities $24,824
Total liabilities $48,561
Stockholders' equity $10,158
Sales $46,997
Net Income $ 3,761
Market value of shares $41,316
Correct Answer: 11.0
What does it mean if a company has a debt ratio of 101.5%?
Correct Answer: The company has 1.5% more total liabilities than total assets.
What is consistent with a continual decline in gross profit if the firm's cost of goods sold
remains the same?
Correct Answer: Continual decrease in sales
Which two cash flow adequacy ratios represent a cash cow?
Correct Answer: $6,991/$5,486 & $5,220/$1,875
What two items of information are revealed on the balance sheet?
Correct Answer: Ownership & Debt
Which term is defined as the residual interest in the net assets of a company?
, Correct Answer: Owners' equity
A corporation has total liabilities of $300 million, total owners' equity of $100 million, and
current assets of $50 million. What is the value of the firm's long-term assets?
Correct Answer: $350 million
Which situation should result in revenue recognition on the income statement for the
year ending 12/31/14 if the firm is using accrual-basis accounting?
Correct Answer: In 2014, a company provides services to a customer for which cash
will be collected the next year (2015).
Which category on the statement of cash flows summarizes cash receipts and
payments to owners and creditors of the company?
Correct Answer: Cash flows from financing activities
Cash flows from financing activities
Correct Answer: In the notes to financial statements
Which assurance does an external audit report provide for its readers?
Correct Answer: The company's financial statements fairly reflect its financial position
Information that can be verified
Correct Answer: Reliable
