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