Test Bank for Financial Accounting for MBAs, 8th
Edition , 7th Edition by Easton | Answer Sheet
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Terms in this set (261)
The four main business activities that financial
Business Activities
accounting addresses.
Shareholders demand financial information primarily
Users of Financial to assess profitability and risk whereas bankers
Statement Information demand information primarily to assess cash flows to
repay loan interest and principal.
Publicly Available Publicly traded companies are required to provide
Financial Reports quarterly financial reports directly to the public.
Publicly traded companies must provide to the
Securities Exchange Commission annual audited
SEC Filings
financial statements (10-K reports) and quarterly
audited financial statements (10-Q reports).
A balance sheet shows a company's position at a
point in time, whereas an income statement, statement
Balance Sheet
of stockholders' equity, and statement of cash flows
show its position over a period of time.
Accounting Equation Assets must always equal liabilities plus equity.
The income statement reports net income which is
Income Statement defined as the company's profit after all expenses and
dividends have been paid.
, A statement of cash flows reports on cash flows for
Statement of Cash Flows operating, investing, and financing activities over a
period of time.
Statement of An increase in common stock would be reflected in
Stockholders' Equity the statement of stockholders' equity.
Return on Assets (ROA) measures the profit the
Return on Assets (ROA)
company makes on each dollar of total assets it uses.
Return on Assets (ROA) = (Net Income / Sales) × Asset
Return on Assets Formula
Turnover.
Asset turnover is an efficiency metric that indicates
Asset Turnover how effectively a company uses its assets to generate
revenue.
Financial statements are influenced by five important
forces that determine a company's competitive
Financial Accounting and
intensity: (A) industry competition, (B) buyer power,
Business Analysis
(C) supplier power, (D) product substitutes, and (E)
threat of entry.
A "clean" audit report asserts that management has
prepared all necessary financial statements and the
Audit Report
auditor has expressed its opinion that they are
prepared in conformity with GAAP.
Shareholders Individuals or entities that own shares in a company.
Employees Individuals who work for a company.
Other companies in the same industry vying for the
Competitors
same customers.
Taxing agencies Government entities responsible for collecting taxes.
A rule adopted by the SEC to curb selective
Regulation FD
disclosure of information by public companies.
Statement of Assets and A financial statement that provides a detailed account
Liabilities of a company's assets and liabilities.
Edition , 7th Edition by Easton | Answer Sheet
Included
Save
Terms in this set (261)
The four main business activities that financial
Business Activities
accounting addresses.
Shareholders demand financial information primarily
Users of Financial to assess profitability and risk whereas bankers
Statement Information demand information primarily to assess cash flows to
repay loan interest and principal.
Publicly Available Publicly traded companies are required to provide
Financial Reports quarterly financial reports directly to the public.
Publicly traded companies must provide to the
Securities Exchange Commission annual audited
SEC Filings
financial statements (10-K reports) and quarterly
audited financial statements (10-Q reports).
A balance sheet shows a company's position at a
point in time, whereas an income statement, statement
Balance Sheet
of stockholders' equity, and statement of cash flows
show its position over a period of time.
Accounting Equation Assets must always equal liabilities plus equity.
The income statement reports net income which is
Income Statement defined as the company's profit after all expenses and
dividends have been paid.
, A statement of cash flows reports on cash flows for
Statement of Cash Flows operating, investing, and financing activities over a
period of time.
Statement of An increase in common stock would be reflected in
Stockholders' Equity the statement of stockholders' equity.
Return on Assets (ROA) measures the profit the
Return on Assets (ROA)
company makes on each dollar of total assets it uses.
Return on Assets (ROA) = (Net Income / Sales) × Asset
Return on Assets Formula
Turnover.
Asset turnover is an efficiency metric that indicates
Asset Turnover how effectively a company uses its assets to generate
revenue.
Financial statements are influenced by five important
forces that determine a company's competitive
Financial Accounting and
intensity: (A) industry competition, (B) buyer power,
Business Analysis
(C) supplier power, (D) product substitutes, and (E)
threat of entry.
A "clean" audit report asserts that management has
prepared all necessary financial statements and the
Audit Report
auditor has expressed its opinion that they are
prepared in conformity with GAAP.
Shareholders Individuals or entities that own shares in a company.
Employees Individuals who work for a company.
Other companies in the same industry vying for the
Competitors
same customers.
Taxing agencies Government entities responsible for collecting taxes.
A rule adopted by the SEC to curb selective
Regulation FD
disclosure of information by public companies.
Statement of Assets and A financial statement that provides a detailed account
Liabilities of a company's assets and liabilities.
