Accounting for decision makers C213 WGU

Accounting for decision makers C213 WGU Accounting steps. - correct answere---1. Prepare 2. Analyze 3. Gather 4. Make decisions 5. Implement 6. Observe. Managerial info is inside or outside the business? - correct answere---Inside, Internal True or false, managerial accounting uses BOTH managerial and financial accounting? - correct answere---True. Financial accounting is only outside. Managerial accounting can be inside AND outside. Financial is inside or outside the business? - correct answere---Outside, External, includes lenders and investors The financial statement includes what 3 documents - correct answere---Balance sheet, income statement, and statement of cash flows Point in time, Assets (resources) and liabilities (obligations) - correct answere---Balance Sheet Period of time (usually 1 year), amount of profit made - correct answere---Income Statement Period of time, where money came from, and where it went. Inflow and outflow of cash (Cash Flows). Change in money for the period. - correct answere---Statement of Cash flows Assets= liabilities + equity - correct answere---Balance sheet equation Net income=Revenue - Expenses - correct answere---Revenue equation The statement of cash flows includes what three activities - correct answere---Operating, investing, and financial activities The decision makers in the U.S. (accounting rules) - correct answere---FASB: Financial accounting standards. Private, no government involvement. It is a public process, includes individuals experienced in business and accounting (7 members). Developed by accounting rule makers. No Legal authority. - correct answere---GAAP: General accepted accounting principles We need accounting rules for... - correct answere---comparability U.S. gov agency responsible for ensuring that investors, creditors, and other financial statement users are provided with reliable information. It watches behavior in financial markets. - correct answere---SEC: Security and exchange commission. Located in Article 1, Sec 8, Clause 3 What forms do the SEC regulate? - correct answere---Registration statements (prospectus), Form 10-K, Form 10-Q, and schedule 14A (proxy statement). These are all publicly viewable. What does the SEC do? - correct answere---Oversees stock exchanges, can suspend a company, investigate and suspect violations of the SEC rules. Does the SEC have legal authority? - correct answere---YES. The SEC has legal authority to establish accounting rules and disclosure requirements. Financial accounting rule per the US constitution - correct answere---USA congress->SEC->FASB The SEC created the - correct answere---FASB: Financial accounting standards board FASB created - correct answere---GAAP (has no legal authority) What sets auditory standards, continue education credits, CPA exam, and is the code of professional conduct? - correct answere---AIPCA: American INSTITUTE of certified public accountants. Who is the only person who can sign audit reports? - correct answere---Only CPA's: Certified public accountants. The Sarbanes-Oxley Act "SOX" created? - correct answere---PCAOB: Public company accounting oversight board. PCAOB is under supervision of? - correct answere---Under supervision of the SEC. Who appoints members, approves actions, gov standards, inspections, and investigations? It is a private group and OVERSEES. AUDITORS? - correct answere---PCAOB: Public Company Accounting OVERSIGHT Board. IRS - correct answere---U.S. Gov agency that collects and regulates income taxes. Their primary goal is to collect revenue. There are two sets of books. Tax Books and Financial accounting books. - correct answere---Economic income and accounting income books. & Tax income, and cash flow books. IASB: Internatonal Accounting Standard Board - correct answere---Similar to the FASB, but not 100% the same. It is international, everywhere but the U.S. Barriers to international convergence are? - correct answere---Who enforces and national policies. Rules