TEST BANK
Financial Accounting
David Spiceland
5th Edition
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R
SE
,Table of Contents
Part 1: Introduction to Financial Accounting
1. Introduction to Financial Accounting
2. The Accounting Information System
3. The Balance Sheet and Financial Disclosures
Part 2: Operating Activities
4. The Income Statement, Comprehensive Income, and the Statement of Cash Flows
5. Revenue Recognition and Income Measurement
6. Cash and Receivables
7. Inventories: Measurement and Flow Assumptions
8. Inventories: Additional Valuation Issues
Part 3: Investing and Financing Activities
9. Property, Plant, and Equipment and Intangible Assets: Acquisition and Disposition
10. Property, Plant, and Equipment and Intangible Assets: Utilization and Impairment
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11. Investments
12. Current Liabilities and Contingencies
13. Long-Term Liabilities
14. Shareholders’ Equity
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Part 4: Other Measurement and Reporting Topics
15. Accounting for Income Taxes
16. Pensions and Other Postretirement Benefits
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17. Share-Based Compensation and Earnings Per Share
18. Accounting Changes and Error Corrections
19. The Statement of Cash Flows Revisited
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20. Full Disclosure in Financial Reporting
Appendices
A. Compound Interest Tables
B. Ratio Analysis Guide
C. Summary of Key Accounting Standards
D. Glossary
E. Index
,Financial Accounting, 5e (Spiceland)
Chapter 1 A Framework for Financial Accounting
1) Accounting is a system of maintaining records of a company's operations and communicating
that information to decision makers.
Answer: TRUE
Difficulty: 1 Easy
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
2) Accounting information is used by investors to decide whether to invest in a company's stock.
Answer: TRUE
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Difficulty: 1 Easy
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Remember
AACSB: Reflective Thinking
U
AICPA: BB Critical Thinking
3) Accounting information is used by creditors to decide whether to invest in a company's stock.
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Answer: FALSE
Explanation: Creditors lend money to a company.
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Difficulty: 1 Easy
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
4) The primary functions of financial accounting are to measure business activities of a company
and to communicate those measurements to internal parties for decision-making purposes.
Answer: FALSE
Explanation: Financial accounting primarily serves to provide information to external parties.
Difficulty: 2 Medium
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Understand
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
, 5) Financing activities are transactions involving external sources of funding.
Answer: TRUE
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: FN Measurement
6) Investing activities include the purchase and sale of long-term resources.
Answer: TRUE
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
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measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: FN Measurement
U
7) Operating activities include transactions that relate to the primary operations of the company.
Answer: TRUE
R
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
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measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: FN Measurement
8) A corporation is an entity that is legally separate from its owners.
Answer: TRUE
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
Financial Accounting
David Spiceland
5th Edition
JN
U
R
SE
,Table of Contents
Part 1: Introduction to Financial Accounting
1. Introduction to Financial Accounting
2. The Accounting Information System
3. The Balance Sheet and Financial Disclosures
Part 2: Operating Activities
4. The Income Statement, Comprehensive Income, and the Statement of Cash Flows
5. Revenue Recognition and Income Measurement
6. Cash and Receivables
7. Inventories: Measurement and Flow Assumptions
8. Inventories: Additional Valuation Issues
Part 3: Investing and Financing Activities
9. Property, Plant, and Equipment and Intangible Assets: Acquisition and Disposition
10. Property, Plant, and Equipment and Intangible Assets: Utilization and Impairment
JN
11. Investments
12. Current Liabilities and Contingencies
13. Long-Term Liabilities
14. Shareholders’ Equity
U
Part 4: Other Measurement and Reporting Topics
15. Accounting for Income Taxes
16. Pensions and Other Postretirement Benefits
R
17. Share-Based Compensation and Earnings Per Share
18. Accounting Changes and Error Corrections
19. The Statement of Cash Flows Revisited
SE
20. Full Disclosure in Financial Reporting
Appendices
A. Compound Interest Tables
B. Ratio Analysis Guide
C. Summary of Key Accounting Standards
D. Glossary
E. Index
,Financial Accounting, 5e (Spiceland)
Chapter 1 A Framework for Financial Accounting
1) Accounting is a system of maintaining records of a company's operations and communicating
that information to decision makers.
Answer: TRUE
Difficulty: 1 Easy
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
2) Accounting information is used by investors to decide whether to invest in a company's stock.
Answer: TRUE
JN
Difficulty: 1 Easy
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Remember
AACSB: Reflective Thinking
U
AICPA: BB Critical Thinking
3) Accounting information is used by creditors to decide whether to invest in a company's stock.
R
Answer: FALSE
Explanation: Creditors lend money to a company.
SE
Difficulty: 1 Easy
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
4) The primary functions of financial accounting are to measure business activities of a company
and to communicate those measurements to internal parties for decision-making purposes.
Answer: FALSE
Explanation: Financial accounting primarily serves to provide information to external parties.
Difficulty: 2 Medium
Topic: Defining Accounting
Learning Objective: 01-01 Describe the two primary functions of financial accounting.
Bloom's: Understand
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
, 5) Financing activities are transactions involving external sources of funding.
Answer: TRUE
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: FN Measurement
6) Investing activities include the purchase and sale of long-term resources.
Answer: TRUE
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
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measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: FN Measurement
U
7) Operating activities include transactions that relate to the primary operations of the company.
Answer: TRUE
R
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
SE
measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: FN Measurement
8) A corporation is an entity that is legally separate from its owners.
Answer: TRUE
Difficulty: 1 Easy
Topic: Measuring Business Activities
Learning Objective: 01-02 Understand the business activities that financial accounting
measures.
Bloom's: Remember
AACSB: Reflective Thinking
AICPA: BB Critical Thinking
