TEST BANK
Financial Accounting Tools For Business Decision
Making, 10th Edition, Paul D. Kimmel,
Chapters 1 – 13, Complete
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
,TABLE OF CONTENTS
1 Introduction to Financial Statements
2 A Further Look at Financial Statements
3 The Accounting Information System
4 Accrual Accounting Concepts
5 Merchandising Operations and the Multiple-Step Income Statement
6 Reporting and Analyzing Inventory
7 Fraud, Internal Control, and Cash
8 Reporting and Analyzing Receivables
9 Reporting and Analyzing Long-Lived Assets
10 Reporting and Analyzing Liabilities
11 Reporting and Analyzing Stockholders’ Equity
12 Statement of Cash Flows
13 Financial Analysis: The Big Picture
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
,CHAPTER 1
INTRODUCTION TO FINANCIAL STATEMENTS
CHAPTER LEARNING OBJECTIVES
1. Identify the forms of business organization and the uses of accounting information. A sole
proprietorship is a business owned by one qperson. qA qpartnership qis qa qbusiness qowned qby qtwo
qor qmore qpeople qassociated qas qpartners. qA qcorporation qis qa qseparate qlegal qentity qfor qwhich
qevidence qof qownership qis qprovided qby qshares qof qstock. qInternal qusers qare qmanagers qwho
qneed qaccounting qinformation qto qplan, qorganize, qand qrun qbusiness qoperations. qThe qprimary
qexternal qusers qare qinvestors qand qcreditors. qInvestors q(stockholders) quse qaccounting
qinformation qto qdecide qwhether qto qbuy, qhold, qor qsell qshares qof qa qcompany‘s qstock. qCreditors
q(suppliers qand qbankers) q use q accounting q information q to q assess qthe q risk q of q granting q credit
q or q loaning q money qto qa qbusiness. qOther qgroups qwho qhave qan qindirect qinterest qin qa qbusiness
qare qtaxing qauthorities, qcustomers, qlabor qunions, qand q regulatory qagencies.
2. Explain qthe qthree qprincipal qtypes qof qbusiness qactivity. qFinancing qactivities q involve qcollecting
qthe qnecessary qfunds qto qsupport qthe qbusiness. qInvesting qactivities qinvolve qacquiring qthe
qresources qnecessary qto qrun qthe qbusiness. qOperating qactivities qinvolve qputting q the qresources
qof q the qbusiness qinto qaction qto qgenerate qa qprofit.
3. Describe qthe qfour qfinancial qstatements qand qhow qthey qare qprepared. qAn qincome qstatement
qpresents qthe qrevenues qand qexpenses qof qa qcompany qfor qa qspecific qperiod qof qtime. qA
qretained qearnings qstatement qsummarizes qthe qchanges qin qretained qearnings qthat qhave
qoccurred qfor qa qspecific qperiod qof qtime. qA qbalance qsheet qreports qthe qassets, qliabilities, qand
qstockholders‘ qequity qof qa qbusiness qat qa qspecific qdate. qA qstatement qof qcash qflows
q summarizes q information qconcerning qthe qcash qinflows q(receipts) qand qoutflows q(payments)
qfor qa qspecific qperiod qof qtime. qAssets qare qresources qowned qby qa qbusiness. qLiabilities qare qthe
qdebts qand qobligations qof qthe qbusiness. qLiabilities qrepresent qclaims qof qcreditors qon qthe qassets
qof qthe qbusiness. qStockholders‘ qequity qrepresents qthe qclaims qof qowners qon qthe qassets qof qthe
qbusiness. qStockholders‘ qequity qis qsubdivided qinto qtwo qparts: qcommon qstock qand qretained
qearnings. qThe qbasic qaccounting qequation qis qAssets q= qLiabilities q+ qStockholders‘ qEquity. qWithin
qthe qannual qreport, qthe qmanagement qdiscussion qand qanalysis qprovides qmanagement‘s
qinterpretation qof qthe qcompany‘s qresults qand qfinancial qposition qas qwell qas qa qdiscussion qof
qplans qfor qthe qfuture. qNotes qto qthe qfinancial qstatements qprovide qadditional qexplanation qor
qdetail qto qmake qthe qfinancial qstatements qmore qinformative. qThe qauditor‘s qreport qexpresses qan
qopinion qas qto qwhether qthe qfinancial qstatements qpresent qfairly qthe qcompany‘s qresults qof
qoperations qand qfinancial qposition.
*4. qExplain qthe qcareer qopportunities qin qaccounting. qAccounting qoffers qmany qdifferent qjobs qin
qfields qsuch qas qpublic qand qprivate qaccounting, qgovernmental, qand qforensic qaccounting.
qAccounting qis qa qpopular qmajor qbecause qthere qare qmany qdifferent qtypes qof qjobs, qwith
qunlimited qpotential qfor qcareer qadvancement
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
, 2-2 Test Bank for Kimmel, Financial Accounting: Tools for Business Decision Making, 10e
Difficulties:
Easy: q143
Medium: q101
Hard: q12
Question qList qby qSection
Business qOrganization qand qAccounting qInformation qUses:
qForms qof qBusiness qOrganization; q47, q48, q202, q246
Sole qProprietorship: q5, q44, q49, q58, q59
Partnership: q1, q4, q46, q56
Corporation: q2, q3, q45, q50, q51, q52, q53, q55, q57, q233, q245
Hybrid qForms qof qOrganization: q60, q61
Users qand qUses qof q Financial qInformation: q6, q7, q11, q74, q87
Internal qUsers: q62, q63, q64, q75, q77, q82, q234
External qUsers: q8, q9, q10, q12, q65, q76, q78, q79, q80, q81, q83, q84, q85, q86, q88, q89
Data qAnalytics: q66, q67, q68, q69, q70, q235, q236
Ethics qin qFinancial qReporting: q71, q72, q73, q237,
q255qThe qThree qTypes qof qBusiness qActivity: q97
Financing qActivities: q13, q15, q18, q90, q91, q93, q94, q95, q96, q97, q102, q109, q117, q118, q119, q238
Investing qActivities: q14, q16, q98, q99, q115, q116
Operating qActivities: q17, q19, q20, q100, q101, q103, q104, q105, q106, q107, q108, q110, q111, q112, q113,
114
The qFour qFinancial qStatements:
Income qStatement: q21, q22, q23, q24,127, q128, q132, q133, q134, q138, q142, q143
Retained qEarnings qStatement: q120, q122, q123, q 124, q125, q126, q129, q130, q131, q135, q137, q139, q140,
141, q144, q145, q146, q147, q148, q149, q150, q154, q164, q169, q178, q181, q252
Balance qSheet: q25, q27, q28, q29, q30, q31, q32, q33, q34, q35, q136, q151, q152, q153, q163, q165, q166, q168,
170, q173, q177, q179, q180, q182, q185, q186, q187, q188, q199, q200, q201, q207, q208, q213, q214, q215, q216,
217, q218, q219, q220, q221, q222, q225, q229, q239, q240, q241, q253
Statement qof q Cash qFlows: q26, q121, q171, q174, q183, q242, q249
Interrelationships qof qStatements: q155, q156, q157, q158, q159, q160, q161, q162, q167, q175, q176, q184,
250, q251, q256
Elements qof qan qAnnual qReport: q36, q41, q192, q196, q197
Management qDiscussion qand qAnalysis: q40, q191
Notes qto qthe qFinancial qStatements: q37, q42, q190, q193, q194, q198, q254
Auditor‘s qReport: q38, q39, q195
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
Financial Accounting Tools For Business Decision
Making, 10th Edition, Paul D. Kimmel,
Chapters 1 – 13, Complete
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
,TABLE OF CONTENTS
1 Introduction to Financial Statements
2 A Further Look at Financial Statements
3 The Accounting Information System
4 Accrual Accounting Concepts
5 Merchandising Operations and the Multiple-Step Income Statement
6 Reporting and Analyzing Inventory
7 Fraud, Internal Control, and Cash
8 Reporting and Analyzing Receivables
9 Reporting and Analyzing Long-Lived Assets
10 Reporting and Analyzing Liabilities
11 Reporting and Analyzing Stockholders’ Equity
12 Statement of Cash Flows
13 Financial Analysis: The Big Picture
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
,CHAPTER 1
INTRODUCTION TO FINANCIAL STATEMENTS
CHAPTER LEARNING OBJECTIVES
1. Identify the forms of business organization and the uses of accounting information. A sole
proprietorship is a business owned by one qperson. qA qpartnership qis qa qbusiness qowned qby qtwo
qor qmore qpeople qassociated qas qpartners. qA qcorporation qis qa qseparate qlegal qentity qfor qwhich
qevidence qof qownership qis qprovided qby qshares qof qstock. qInternal qusers qare qmanagers qwho
qneed qaccounting qinformation qto qplan, qorganize, qand qrun qbusiness qoperations. qThe qprimary
qexternal qusers qare qinvestors qand qcreditors. qInvestors q(stockholders) quse qaccounting
qinformation qto qdecide qwhether qto qbuy, qhold, qor qsell qshares qof qa qcompany‘s qstock. qCreditors
q(suppliers qand qbankers) q use q accounting q information q to q assess qthe q risk q of q granting q credit
q or q loaning q money qto qa qbusiness. qOther qgroups qwho qhave qan qindirect qinterest qin qa qbusiness
qare qtaxing qauthorities, qcustomers, qlabor qunions, qand q regulatory qagencies.
2. Explain qthe qthree qprincipal qtypes qof qbusiness qactivity. qFinancing qactivities q involve qcollecting
qthe qnecessary qfunds qto qsupport qthe qbusiness. qInvesting qactivities qinvolve qacquiring qthe
qresources qnecessary qto qrun qthe qbusiness. qOperating qactivities qinvolve qputting q the qresources
qof q the qbusiness qinto qaction qto qgenerate qa qprofit.
3. Describe qthe qfour qfinancial qstatements qand qhow qthey qare qprepared. qAn qincome qstatement
qpresents qthe qrevenues qand qexpenses qof qa qcompany qfor qa qspecific qperiod qof qtime. qA
qretained qearnings qstatement qsummarizes qthe qchanges qin qretained qearnings qthat qhave
qoccurred qfor qa qspecific qperiod qof qtime. qA qbalance qsheet qreports qthe qassets, qliabilities, qand
qstockholders‘ qequity qof qa qbusiness qat qa qspecific qdate. qA qstatement qof qcash qflows
q summarizes q information qconcerning qthe qcash qinflows q(receipts) qand qoutflows q(payments)
qfor qa qspecific qperiod qof qtime. qAssets qare qresources qowned qby qa qbusiness. qLiabilities qare qthe
qdebts qand qobligations qof qthe qbusiness. qLiabilities qrepresent qclaims qof qcreditors qon qthe qassets
qof qthe qbusiness. qStockholders‘ qequity qrepresents qthe qclaims qof qowners qon qthe qassets qof qthe
qbusiness. qStockholders‘ qequity qis qsubdivided qinto qtwo qparts: qcommon qstock qand qretained
qearnings. qThe qbasic qaccounting qequation qis qAssets q= qLiabilities q+ qStockholders‘ qEquity. qWithin
qthe qannual qreport, qthe qmanagement qdiscussion qand qanalysis qprovides qmanagement‘s
qinterpretation qof qthe qcompany‘s qresults qand qfinancial qposition qas qwell qas qa qdiscussion qof
qplans qfor qthe qfuture. qNotes qto qthe qfinancial qstatements qprovide qadditional qexplanation qor
qdetail qto qmake qthe qfinancial qstatements qmore qinformative. qThe qauditor‘s qreport qexpresses qan
qopinion qas qto qwhether qthe qfinancial qstatements qpresent qfairly qthe qcompany‘s qresults qof
qoperations qand qfinancial qposition.
*4. qExplain qthe qcareer qopportunities qin qaccounting. qAccounting qoffers qmany qdifferent qjobs qin
qfields qsuch qas qpublic qand qprivate qaccounting, qgovernmental, qand qforensic qaccounting.
qAccounting qis qa qpopular qmajor qbecause qthere qare qmany qdifferent qtypes qof qjobs, qwith
qunlimited qpotential qfor qcareer qadvancement
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
, 2-2 Test Bank for Kimmel, Financial Accounting: Tools for Business Decision Making, 10e
Difficulties:
Easy: q143
Medium: q101
Hard: q12
Question qList qby qSection
Business qOrganization qand qAccounting qInformation qUses:
qForms qof qBusiness qOrganization; q47, q48, q202, q246
Sole qProprietorship: q5, q44, q49, q58, q59
Partnership: q1, q4, q46, q56
Corporation: q2, q3, q45, q50, q51, q52, q53, q55, q57, q233, q245
Hybrid qForms qof qOrganization: q60, q61
Users qand qUses qof q Financial qInformation: q6, q7, q11, q74, q87
Internal qUsers: q62, q63, q64, q75, q77, q82, q234
External qUsers: q8, q9, q10, q12, q65, q76, q78, q79, q80, q81, q83, q84, q85, q86, q88, q89
Data qAnalytics: q66, q67, q68, q69, q70, q235, q236
Ethics qin qFinancial qReporting: q71, q72, q73, q237,
q255qThe qThree qTypes qof qBusiness qActivity: q97
Financing qActivities: q13, q15, q18, q90, q91, q93, q94, q95, q96, q97, q102, q109, q117, q118, q119, q238
Investing qActivities: q14, q16, q98, q99, q115, q116
Operating qActivities: q17, q19, q20, q100, q101, q103, q104, q105, q106, q107, q108, q110, q111, q112, q113,
114
The qFour qFinancial qStatements:
Income qStatement: q21, q22, q23, q24,127, q128, q132, q133, q134, q138, q142, q143
Retained qEarnings qStatement: q120, q122, q123, q 124, q125, q126, q129, q130, q131, q135, q137, q139, q140,
141, q144, q145, q146, q147, q148, q149, q150, q154, q164, q169, q178, q181, q252
Balance qSheet: q25, q27, q28, q29, q30, q31, q32, q33, q34, q35, q136, q151, q152, q153, q163, q165, q166, q168,
170, q173, q177, q179, q180, q182, q185, q186, q187, q188, q199, q200, q201, q207, q208, q213, q214, q215, q216,
217, q218, q219, q220, q221, q222, q225, q229, q239, q240, q241, q253
Statement qof q Cash qFlows: q26, q121, q171, q174, q183, q242, q249
Interrelationships qof qStatements: q155, q156, q157, q158, q159, q160, q161, q162, q167, q175, q176, q184,
250, q251, q256
Elements qof qan qAnnual qReport: q36, q41, q192, q196, q197
Management qDiscussion qand qAnalysis: q40, q191
Notes qto qthe qFinancial qStatements: q37, q42, q190, q193, q194, q198, q254
Auditor‘s qReport: q38, q39, q195
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
