BUSA 312-CH 4 (MC) 2024/2025 Exam
Questions and Correct Answers | New
Update
The major elements of the income statement are
a. revenue, cost of goods sold, selling expenses, and general expense.
b. operating section, nonoperating section, discontinued operations,
extraordinary items, and cumulative effect.
c. revenues, expenses, gains, and losses.
d. all of these. - 🧠ANSWER ✔✔C
Information in the income statement helps users to
a. evaluate the past performance of the enterprise.
b. provide a basis for predicting future performance.
c. help assess the risk or uncertainty of achieving future cash flows.
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STATEMENT. ALL RIGHTS RESERVED
,d. all of these. - 🧠ANSWER ✔✔D
Limitations of the income statement include all of the following except
a. items that cannot be measured reliably are not reported.
b. only actual amounts are reported in determining net income.
c. income measurement involves judgment.
d. income numbers are affected by the accounting methods employed. -
🧠ANSWER ✔✔D
Which of the following would represent the least likely use of an income
statement prepared for a business enterprise?
a. Use by customers to determine a company's ability to provide needed
goods and services.
b. Use by labor unions to examine earnings closely as a basis for salary
discussions.
c. Use by government agencies to formulate tax and economic policy.
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STATEMENT. ALL RIGHTS RESERVED
, d. Use by investors interested in the financial position of the entity. -
🧠ANSWER ✔✔D
The income statement reveals
a. resources and equities of a firm at a point in time.
b. resources and equities of a firm for a period of time.
c. net earnings (net income) of a firm at a point in time.
d. net earnings (net income) of a firm for a period of time. - 🧠ANSWER
✔✔D
The income statement information would help in which of the following
tasks?
a. Evaluate the liquidity of a company.
b. Evaluate the solvency of a company
c. Estimate future cash flows
d. Estimate future financial flexibility - 🧠ANSWER ✔✔C
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 3
STATEMENT. ALL RIGHTS RESERVED
Questions and Correct Answers | New
Update
The major elements of the income statement are
a. revenue, cost of goods sold, selling expenses, and general expense.
b. operating section, nonoperating section, discontinued operations,
extraordinary items, and cumulative effect.
c. revenues, expenses, gains, and losses.
d. all of these. - 🧠ANSWER ✔✔C
Information in the income statement helps users to
a. evaluate the past performance of the enterprise.
b. provide a basis for predicting future performance.
c. help assess the risk or uncertainty of achieving future cash flows.
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 1
STATEMENT. ALL RIGHTS RESERVED
,d. all of these. - 🧠ANSWER ✔✔D
Limitations of the income statement include all of the following except
a. items that cannot be measured reliably are not reported.
b. only actual amounts are reported in determining net income.
c. income measurement involves judgment.
d. income numbers are affected by the accounting methods employed. -
🧠ANSWER ✔✔D
Which of the following would represent the least likely use of an income
statement prepared for a business enterprise?
a. Use by customers to determine a company's ability to provide needed
goods and services.
b. Use by labor unions to examine earnings closely as a basis for salary
discussions.
c. Use by government agencies to formulate tax and economic policy.
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 2
STATEMENT. ALL RIGHTS RESERVED
, d. Use by investors interested in the financial position of the entity. -
🧠ANSWER ✔✔D
The income statement reveals
a. resources and equities of a firm at a point in time.
b. resources and equities of a firm for a period of time.
c. net earnings (net income) of a firm at a point in time.
d. net earnings (net income) of a firm for a period of time. - 🧠ANSWER
✔✔D
The income statement information would help in which of the following
tasks?
a. Evaluate the liquidity of a company.
b. Evaluate the solvency of a company
c. Estimate future cash flows
d. Estimate future financial flexibility - 🧠ANSWER ✔✔C
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY 3
STATEMENT. ALL RIGHTS RESERVED
