1
,2
,) Chapter 1
l l Accounting as Information l l
1) Accounting communicates to stakeholders l l l
A) minimally required public financial data. l l l l
B) the financial outcomes of operating, investing, and financing activities.
l l l l l l l l
C) the sales strategy for the operating, marketing, and sales activities.
l l l l l l l l l
D) black and white details about the economics of operating activities. An
l l l l l l l l l l
swer: B l
Diff: 1 l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lCommunication
Bloom's: Comprehension l l
AICPA: AC: Reporting l l
2) Accounting communicates the financial outcomes of a business's activities for
l l l l l l l l l
A) operating.
B) investing.
C) financing.
D) All of these answer choices are correct. A
l l l l l l l
nswer: D l
Diff: 1 l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lCommunication
Bloom's: Comprehension l l
AICPA: AC: Reporting l l
3) In what way do management teams use accounting data?
l l l l l l l l
A) Management teams use accounting data to make business decisions. l l l l l l l l
B) Management teams use accounting data to make and execute plans. l l l l l l l l l
C) Management teams use economic and accounting data together to make decisions.
l l l l l l l l l l
D) All of these answer choices are correct. A
l l l l l l l
nswer: D l
Diff: 1 l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Comprehension l l
AICPA: AC: Risk Assessment, Analysis, and Management
l l l l l l l
3
, 4) Which statement is TRUE? l l l
A) Accounting consists of rigid black and white rules. l l l l l l l
B) Accountants crunch numbers, not make decisions. l l l l l
C) Accounting helps support a prosperous society. l l l l l
D) Accountants focus on debits and credits, not business activities. An l l l l l l l l l
swer: C l
Diff: 1
l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Comprehension l l
AICPA: N/A l
5) Which of the following is NOT a component of an information system?
l l l l l l l l l l l
A) Hardware
B) Software
C) Input
D) Network l
Answer: C l l
Diff: 1
l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Knowledge l l
AICPA: AC: Systems and Process Management
l l l l l l
6) Input to an information system consists of
l l l l l l
A) raw and unorganized data.
l l l
B) hardware and software. l l
C) reported information. l
D) processeddata. l l
Answer: A l
Diff: 1
l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Knowledge l l
AICPA: AC: Systems and Process Management
l l l l l l
7) Which of the following is a definition of output from an information system?
l l l l l l l l l l l l
A) Output is raw and unorganized data. l l l l l
B) Output is information produced by processing data.
l l l l l l
C) Output is database facts and figures. l l l l l
D) Output is information collected from users. A
l l l l l l
nswer: B l
4
,2
,) Chapter 1
l l Accounting as Information l l
1) Accounting communicates to stakeholders l l l
A) minimally required public financial data. l l l l
B) the financial outcomes of operating, investing, and financing activities.
l l l l l l l l
C) the sales strategy for the operating, marketing, and sales activities.
l l l l l l l l l
D) black and white details about the economics of operating activities. An
l l l l l l l l l l
swer: B l
Diff: 1 l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lCommunication
Bloom's: Comprehension l l
AICPA: AC: Reporting l l
2) Accounting communicates the financial outcomes of a business's activities for
l l l l l l l l l
A) operating.
B) investing.
C) financing.
D) All of these answer choices are correct. A
l l l l l l l
nswer: D l
Diff: 1 l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lCommunication
Bloom's: Comprehension l l
AICPA: AC: Reporting l l
3) In what way do management teams use accounting data?
l l l l l l l l
A) Management teams use accounting data to make business decisions. l l l l l l l l
B) Management teams use accounting data to make and execute plans. l l l l l l l l l
C) Management teams use economic and accounting data together to make decisions.
l l l l l l l l l l
D) All of these answer choices are correct. A
l l l l l l l
nswer: D l
Diff: 1 l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Comprehension l l
AICPA: AC: Risk Assessment, Analysis, and Management
l l l l l l l
3
, 4) Which statement is TRUE? l l l
A) Accounting consists of rigid black and white rules. l l l l l l l
B) Accountants crunch numbers, not make decisions. l l l l l
C) Accounting helps support a prosperous society. l l l l l
D) Accountants focus on debits and credits, not business activities. An l l l l l l l l l
swer: C l
Diff: 1
l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Comprehension l l
AICPA: N/A l
5) Which of the following is NOT a component of an information system?
l l l l l l l l l l l
A) Hardware
B) Software
C) Input
D) Network l
Answer: C l l
Diff: 1
l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Knowledge l l
AICPA: AC: Systems and Process Management
l l l l l l
6) Input to an information system consists of
l l l l l l
A) raw and unorganized data.
l l l
B) hardware and software. l l
C) reported information. l
D) processeddata. l l
Answer: A l
Diff: 1
l
Learning Objective: 1.1 Explain how accounting affects both the demand for and supply of information.
l l l l l l l l l l l l l l
Section Reference: Why is Accounting Information Important? AACSB:
l l l l l l l
lAnalytic
Bloom's: Knowledge l l
AICPA: AC: Systems and Process Management
l l l l l l
7) Which of the following is a definition of output from an information system?
l l l l l l l l l l l l
A) Output is raw and unorganized data. l l l l l
B) Output is information produced by processing data.
l l l l l l
C) Output is database facts and figures. l l l l l
D) Output is information collected from users. A
l l l l l l
nswer: B l
4
