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