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Accounting: Tools for
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Business Decision
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Making, 8th Edition
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TEST BANK
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Paul D. Kimmel, Jerry J. Weygandt, Jill E. Mitchell
PP
Comprehensive Test Bank for Instructors
RO
and Students
||| ||| || ||| || | || ||| | || ||| |
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9781119799726
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© Paul D. Kimmel, Jerry J. Weygandt & Jill E. Mitchell. All
rights reserved. Reproduction or distribution without
permission is prohibited.
© MEDGEEK
, TABLE OF CONTENTS
Test Bank – Accounting: Tools for Business Decision Making (8th Edition)
Authors: Paul D. Kimmel, Jerry J. Weygandt, and Jill E. Mitchell
ISBN: 9781119799726
ST
PART I: FINANCIAL ACCOUNTING
Chapter 1: Introduction to Financial Statements
Chapter 2: A Further Look at Financial Statements
UV
Chapter 3: The Accounting Information System
Chapter 4: Accrual Accounting Concepts
Chapter 5: Merchandising Operations and the Multiple-Step Income Statement
Chapter 6: Reporting and Analyzing Inventory
Chapter 7: Fraud, Internal Control, and Cash
Chapter 8: Reporting and Analyzing Receivables
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Chapter 9: Reporting and Analyzing Long-Lived Assets
Chapter 10: Reporting and Analyzing Liabilities
Chapter 11: Reporting and Analyzing Stockholders' Equity
Chapter 12: Statement of Cash Flows
_A
Chapter 13: Financial Analysis: The Big Picture
PART II: MANAGERIAL ACCOUNTING
Chapter 14: Managerial Accounting
PP
Chapter 15: Job Order Costing
Chapter 16: Process Costing
Chapter 17: Activity-Based Costing
Chapter 18: Cost-Volume-Profit
Chapter 19: Cost-Volume-Profit Analysis: Additional Issues
RO
Chapter 20: Incremental Analysis
Chapter 21: Pricing
Chapter 22: Budgetary Planning
Chapter 23: Budgetary Control and Responsibility Accounting
Chapter 24: Standard Costs and Balanced Scorecard
Chapter 25: Planning for Capital Investments
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, CHAPTER 1
INTRODUCTION TO FINANCIAL STATEMENTS
ST
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 person. A partnership is a business owned
by two or more people associated as partners. A corporation is a separate legal entity for
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which evidence of ownership is provided by shares of stock. Internal users are managers
who need accounting information to plan, organize, and run business operations. The
primary external users are investors and creditors. Investors (stockholders) use accounting
information to decide whether to buy, hold, or sell shares of a company‘s stock. Creditors
(suppliers and bankers) use accounting information to assess the risk of granting credit or
loaning money to a business. Other groups who have an indirect interest in a business are
IA
taxing authorities, customers, labor unions, and regulatory agencies.
2. Explain the three principal types of business activity. Financing activities involve
collecting the necessary funds to support the business. Investing activities involve acquiring
_A
the resources necessary to run the business. Operating activities involve putting the
resources of the business into action to generate a profit.
3. Describe the four financial statements and how they are prepared. An income statement
presents the revenues and expenses of a company for a specific period of time. A retained
earnings statement summarizes the changes in retained earnings that have occurred for a
PP
specific period of time. A balance sheet reports the assets, liabilities, and stockholders‘
equity of a business at a specific date. A statement of cash flows summarizes information
concerning the cash inflows (receipts) and outflows (payments) for a specific period of time.
Assets are resources owned by a business. Liabilities are the debts and obligations of the
business. Liabilities represent claims of creditors on the assets of the business.
RO
Stockholders‘ equity represents the claims of owners on the assets of the business.
Stockholders‘ equity is subdivided into two parts: common stock and retained earnings. The
basic accounting equation is Assets = Liabilities + Stockholders‘ Equity. Within the annual
report, the management discussion and analysis provides management‘s interpretation of
the company‘s results and financial position as well as a discussion of plans for the future.
Notes to the financial statements provide additional explanation or detail to make the
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financial statements more informative. The auditor‘s report expresses an opinion as to
whether the financial statements present fairly the company‘s results of operations and
financial position.
*4. Explain the career opportunities in accounting. Accounting offers many different jobs in
fields such as public and private accounting, governmental, and forensic accounting.
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Accounting is a popular major because there are many different types of jobs, with unlimited
potential for career advancement
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: 143
Medium: 101
Hard: 12
ST
Question List by Section
Business Organization and Accounting Information Uses:
Forms of Business Organization; 47, 48, 202, 246
Sole Proprietorship: 5, 44, 49, 58, 59
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Partnership: 1, 4, 46, 56
Corporation: 2, 3, 45, 50, 51, 52, 53, 55, 57, 233, 245
Hybrid Forms of Organization: 60, 61
Users and Uses of Financial Information: 6, 7, 11, 74, 87
Internal Users: 62, 63, 64, 75, 77, 82, 234
External Users: 8, 9, 10, 12, 65, 76, 78, 79, 80, 81, 83, 84, 85, 86, 88, 89
IA
Data Analytics: 66, 67, 68, 69, 70, 235, 236
Ethics in Financial Reporting: 71, 72, 73, 237, 255
The Three Types of Business Activity: 97
Financing Activities: 13, 15, 18, 90, 91, 93, 94, 95, 96, 97, 102, 109, 117, 118, 119, 238
_A
Investing Activities: 14, 16, 98, 99, 115, 116
Operating Activities: 17, 19, 20, 100, 101, 103, 104, 105, 106, 107, 108, 110, 111, 112, 113,
114
The Four Financial Statements:
Income Statement: 21, 22, 23, 24,127, 128, 132, 133, 134, 138, 142, 143
Retained Earnings Statement: 120, 122, 123, 124, 125, 126, 129, 130, 131, 135, 137, 139,
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140, 141, 144, 145, 146, 147, 148, 149, 150, 154, 164, 169, 178, 181, 252
Balance Sheet: 25, 27, 28, 29, 30, 31, 32, 33, 34, 35, 136, 151, 152, 153, 163, 165, 166, 168,
170, 173, 177, 179, 180, 182, 185, 186, 187, 188, 199, 200, 201, 207, 208, 213, 214, 215, 216,
217, 218, 219, 220, 221, 222, 225, 229, 239, 240, 241, 253
Statement of Cash Flows: 26, 121, 171, 174, 183, 242, 249
RO
Interrelationships of Statements: 155, 156, 157, 158, 159, 160, 161, 162, 167, 175, 176, 184,
250, 251, 256
Elements of an Annual Report: 36, 41, 192, 196, 197
Management Discussion and Analysis: 40, 191
Notes to the Financial Statements: 37, 42, 190, 193, 194, 198, 254
Auditor‘s Report: 38, 39, 195
VE
D?
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
Accounting: Tools for
ST
Business Decision
UV
Making, 8th Edition
IA
TEST BANK
_A
Paul D. Kimmel, Jerry J. Weygandt, Jill E. Mitchell
PP
Comprehensive Test Bank for Instructors
RO
and Students
||| ||| || ||| || | || ||| | || ||| |
VE
9781119799726
D?
© Paul D. Kimmel, Jerry J. Weygandt & Jill E. Mitchell. All
rights reserved. Reproduction or distribution without
permission is prohibited.
© MEDGEEK
, TABLE OF CONTENTS
Test Bank – Accounting: Tools for Business Decision Making (8th Edition)
Authors: Paul D. Kimmel, Jerry J. Weygandt, and Jill E. Mitchell
ISBN: 9781119799726
ST
PART I: FINANCIAL ACCOUNTING
Chapter 1: Introduction to Financial Statements
Chapter 2: A Further Look at Financial Statements
UV
Chapter 3: The Accounting Information System
Chapter 4: Accrual Accounting Concepts
Chapter 5: Merchandising Operations and the Multiple-Step Income Statement
Chapter 6: Reporting and Analyzing Inventory
Chapter 7: Fraud, Internal Control, and Cash
Chapter 8: Reporting and Analyzing Receivables
IA
Chapter 9: Reporting and Analyzing Long-Lived Assets
Chapter 10: Reporting and Analyzing Liabilities
Chapter 11: Reporting and Analyzing Stockholders' Equity
Chapter 12: Statement of Cash Flows
_A
Chapter 13: Financial Analysis: The Big Picture
PART II: MANAGERIAL ACCOUNTING
Chapter 14: Managerial Accounting
PP
Chapter 15: Job Order Costing
Chapter 16: Process Costing
Chapter 17: Activity-Based Costing
Chapter 18: Cost-Volume-Profit
Chapter 19: Cost-Volume-Profit Analysis: Additional Issues
RO
Chapter 20: Incremental Analysis
Chapter 21: Pricing
Chapter 22: Budgetary Planning
Chapter 23: Budgetary Control and Responsibility Accounting
Chapter 24: Standard Costs and Balanced Scorecard
Chapter 25: Planning for Capital Investments
VE
D?
, CHAPTER 1
INTRODUCTION TO FINANCIAL STATEMENTS
ST
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 person. A partnership is a business owned
by two or more people associated as partners. A corporation is a separate legal entity for
UV
which evidence of ownership is provided by shares of stock. Internal users are managers
who need accounting information to plan, organize, and run business operations. The
primary external users are investors and creditors. Investors (stockholders) use accounting
information to decide whether to buy, hold, or sell shares of a company‘s stock. Creditors
(suppliers and bankers) use accounting information to assess the risk of granting credit or
loaning money to a business. Other groups who have an indirect interest in a business are
IA
taxing authorities, customers, labor unions, and regulatory agencies.
2. Explain the three principal types of business activity. Financing activities involve
collecting the necessary funds to support the business. Investing activities involve acquiring
_A
the resources necessary to run the business. Operating activities involve putting the
resources of the business into action to generate a profit.
3. Describe the four financial statements and how they are prepared. An income statement
presents the revenues and expenses of a company for a specific period of time. A retained
earnings statement summarizes the changes in retained earnings that have occurred for a
PP
specific period of time. A balance sheet reports the assets, liabilities, and stockholders‘
equity of a business at a specific date. A statement of cash flows summarizes information
concerning the cash inflows (receipts) and outflows (payments) for a specific period of time.
Assets are resources owned by a business. Liabilities are the debts and obligations of the
business. Liabilities represent claims of creditors on the assets of the business.
RO
Stockholders‘ equity represents the claims of owners on the assets of the business.
Stockholders‘ equity is subdivided into two parts: common stock and retained earnings. The
basic accounting equation is Assets = Liabilities + Stockholders‘ Equity. Within the annual
report, the management discussion and analysis provides management‘s interpretation of
the company‘s results and financial position as well as a discussion of plans for the future.
Notes to the financial statements provide additional explanation or detail to make the
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financial statements more informative. The auditor‘s report expresses an opinion as to
whether the financial statements present fairly the company‘s results of operations and
financial position.
*4. Explain the career opportunities in accounting. Accounting offers many different jobs in
fields such as public and private accounting, governmental, and forensic accounting.
D?
Accounting is a popular major because there are many different types of jobs, with unlimited
potential for career advancement
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: 143
Medium: 101
Hard: 12
ST
Question List by Section
Business Organization and Accounting Information Uses:
Forms of Business Organization; 47, 48, 202, 246
Sole Proprietorship: 5, 44, 49, 58, 59
UV
Partnership: 1, 4, 46, 56
Corporation: 2, 3, 45, 50, 51, 52, 53, 55, 57, 233, 245
Hybrid Forms of Organization: 60, 61
Users and Uses of Financial Information: 6, 7, 11, 74, 87
Internal Users: 62, 63, 64, 75, 77, 82, 234
External Users: 8, 9, 10, 12, 65, 76, 78, 79, 80, 81, 83, 84, 85, 86, 88, 89
IA
Data Analytics: 66, 67, 68, 69, 70, 235, 236
Ethics in Financial Reporting: 71, 72, 73, 237, 255
The Three Types of Business Activity: 97
Financing Activities: 13, 15, 18, 90, 91, 93, 94, 95, 96, 97, 102, 109, 117, 118, 119, 238
_A
Investing Activities: 14, 16, 98, 99, 115, 116
Operating Activities: 17, 19, 20, 100, 101, 103, 104, 105, 106, 107, 108, 110, 111, 112, 113,
114
The Four Financial Statements:
Income Statement: 21, 22, 23, 24,127, 128, 132, 133, 134, 138, 142, 143
Retained Earnings Statement: 120, 122, 123, 124, 125, 126, 129, 130, 131, 135, 137, 139,
PP
140, 141, 144, 145, 146, 147, 148, 149, 150, 154, 164, 169, 178, 181, 252
Balance Sheet: 25, 27, 28, 29, 30, 31, 32, 33, 34, 35, 136, 151, 152, 153, 163, 165, 166, 168,
170, 173, 177, 179, 180, 182, 185, 186, 187, 188, 199, 200, 201, 207, 208, 213, 214, 215, 216,
217, 218, 219, 220, 221, 222, 225, 229, 239, 240, 241, 253
Statement of Cash Flows: 26, 121, 171, 174, 183, 242, 249
RO
Interrelationships of Statements: 155, 156, 157, 158, 159, 160, 161, 162, 167, 175, 176, 184,
250, 251, 256
Elements of an Annual Report: 36, 41, 192, 196, 197
Management Discussion and Analysis: 40, 191
Notes to the Financial Statements: 37, 42, 190, 193, 194, 198, 254
Auditor‘s Report: 38, 39, 195
VE
D?
Copyright © 2022 John Wiley & Sons, Inc. (For Instructor Use Only)
