TEST BANK - Intermediate Accounting, 3rd Edition by Elizabeth A. Gordon, Jana S. Raedy, All Chapters 1 - 22, Complete A+ Guide

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,Intermediate fAccounting, f3e f(Gordon/Raedy/Sannella)
Chapter f1 The fFinancial fReporting fEnvironment

1.1 Overview fof fFinancial fReporting

1) The ffinancial freporting fprocess fgenerates fthree fbasic ffinancial
fstatements. fAnswer: f FALSE

Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

2) The fdemand ffor ffinancial finformation fis fbased fon fmarket fparticipant
fdemand. fAnswer: f TRUE

Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

3) Managers fof feconomic fentities fare fbest fconsidered fto fbe fusers fof ffinancial
finformation. fAnswer: f FALSE

Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

4) Managers fof feconomic fentities fare fbest fconsidered fto fbe fpreparers fof ffinancial
finformation. fAnswer: f TRUE

Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

5) The fSecurities fand fExchange fCommission f(SEC) fregulates ffinancial freporting ffor fpublicly
ftraded fcompanies.

Answer: f f TRUE
Diff: f2
Objective: f 1.1
fIFRS/GAAP: f GAAP

AACSB: f f Application fof fknowledge

6) The fFASB fgives fthe fSEC fauthority fto fregulate faccounting ffor fpublicly ftraded
fcompanies. fAnswer: f FALSE

Diff: f1
Objective: f 1.1
fIFRS/GAAP: f GAAP

AACSB: f f Application fof fknowledge

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,7) The fPublic fCompany fAccounting fOversight fBoard f(PCAOB) fsets ffinancial faccounting fstandards
fand foversees fthe faudits fof fpublic fcompanies fin fthe fUnited fStates.

Answer: f f FALSE
Diff: f1
Objective: f 1.1
fIFRS/GAAP: f GAAP

AACSB: f f Application fof fknowledge

8) Financial faccounting fstandards finfluence fthe fbehavior fof fmanagers fand fother finternal
fusers. fAnswer: f TRUE

Diff: f2
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

9) Theories fand fprocedures fthat fevolve fas fa fresult fof flobbying ffrom fvarious fgroups fare fexamples
fof fproactive ffactors fwithin fthe flegal, feconomic, fpolitical, fand fsocial fenvironment.

Answer: f f FALSE
Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

10) Financial finformation fincludes finformation fthat fis fnot fgoverned fby frules fset fforth fby fthe
faccounting fstandard-setting fbodies.

Answer: f f TRUE
Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

11) What fis fthe fterm fthat fdescribes fthe fprocess fof fidentifying, fmeasuring, fand fcommunicating
ffinancial finformation fabout fan feconomic fentity fto fvarious fuser fgroups?

A) financial freporting
B) accounting fstandard fsetting
C) financial fstatement
D) financial faccounting
fAnswer: f D

Diff: f2
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge




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, 12) Which felement fof ffinancial faccounting finvolves fidentifying fthe findividuals fwho fdemand
ffinancial finformation?

A) financial finformation
B) economic fentity
C) user fgroups
D) legal, feconomic, fpolitical, fand fsocial
fenvironment fAnswer: f C

Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

13) Which fof fthe ffollowing fis fnot fone fof fthe ffour fbasic ffinancial fstatements?
A) balance fsheet
B) trial fbalance
C) cash fflows fstatement
D) statement fof fcomprehensive fincome
fAnswer: f B

Diff: f1
Objective: f 1.1
fIFRS/GAAP:

f GAAP/IFRS

AACSB: f f Application fof fknowledge

14) Which forganization fis fresponsible ffor fpromulgating fU.S. fGAAP?
A) Financial f Accounting fStandards f Board
B) Public fCompany fAccounting fOversight fBoard
C) International fAccounting fStandards f Board
D) Securities fand fExchange fCommission
fAnswer: f A

Diff: f1
Objective: f 1.1
fIFRS/GAAP:
f GAAP/IFRS

AACSB: f f Application fof fknowledge

15) Which forganization fis fresponsible ffor fsetting fauditing fstandards fand foverseeing fthe faudits fof
fpublic fcompanies fin fthe fUnited fStates?

A) Financial fAccounting fStandards f Board
B) Public fCompany fAccounting fOversight fBoard
C) American fInstitute fof fCertified fPublic fAccountants
D) Securities fand fExchange fCommission
fAnswer: f B

Diff: f1
Objective: f 1.1
fIFRS/GAAP: f GAAP

AACSB: f f Application fof fknowledge




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Copyright © 2022 Pearson Education, Inc.