Intermediate Accounting 18th Edition Test Bank by (Kieso/Weygandt/ Warfield) All 23 Chapters Covered & Verified, ISBN: 9781119790976

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ACCOUNTINGCYCLEREVIEW


TRUE-FALSE—Conceptual
1. Economic events that require recording in the financial statements are
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called accounting transactions.
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Ans: T, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Industry/Sector Perspective,
x x x x x x x x x x x x x x x


AICPA FC: Measurement, AICPA PC: None, IMA: FSA
x x x x x x x x




2. Revenue increases stockholders’ equity and should be recorded whenever cash is received from
x x x x x x x x x x x x


xcustomers.

Ans: F, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective,
x x x x x x x x x x x x x x x


AICPA FC: Reporting, AICPA PC: None, IMA: Reporting
x x x x x x x x




3. Collection on an account receivable will increase both cash and accounts receivable.
x x x x x x x x x x x




Ans: F, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective,
x x x x x x x x x x x x x x x


AICPA FC: Measurement, AICPA PC: None, IMA: FSA
x x x x x x x x




4. The payment of a liability decreases both cash and accounts payable.
x x x x x x x x x x




Ans: T, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective,
x x x x x x x x x x x x x x x


AICPA FC: Measurement, AICPA PC: None, IMA: FSA
x x x x x x x x