Test Bank Intermediate
Accounting (18TH) by
Kieso, Weygandt and
Warfield| Chapter 1- 23
📊INTERMEDIATE ACCOUNTING –
PRACTICE TEST BANk
1. The objective of financial reporting is to:
A. Provide tax information
B. Provide information useful to investors and creditors
C. Reduce company costs
D. Ensure profits
✅ Answer: B
2. Which is a primary qualitative characteristic?
A. Comparability
B. Verifiability
C. Relevance
D. Timeliness
✅ Answer: C
3. Faithful representation includes:
,A. Predictive value
B. Confirmatory value
C. Completeness
D. Timeliness
✅ Answer: C
4. Which assumption states that a business will continue operating?
A. Monetary unit
B. Going concern
C. Periodicity
D. Accrual
✅ Answer: B
5. Revenue recognition occurs when:
A. Cash is received
B. Performance obligation is satisfied
C. Invoice is sent
D. Contract signed
✅ Answer: B
Financial Statements
6. Which statement shows financial position?
A. Income statement
B. Balance sheet
C. Cash flow statement
D. Retained earnings
✅ Answer: B
, 7. Assets = Liabilities +:
A. Revenue
B. Equity
C. Expenses
D. Profit
✅ Answer: B
8. Which is a current asset?
A. Equipment
B. Inventory
C. Building
D. Land
✅ Answer: B
9. Retained earnings increase with:
A. Expenses
B. Dividends
C. Net income
D. Liabilities
✅ Answer: C
10. Which statement reports cash flows?
A. Balance sheet
B. Income statement
C. Cash flow statement
D. Equity statement
✅ Answer: C
Accounting Cycle
Accounting (18TH) by
Kieso, Weygandt and
Warfield| Chapter 1- 23
📊INTERMEDIATE ACCOUNTING –
PRACTICE TEST BANk
1. The objective of financial reporting is to:
A. Provide tax information
B. Provide information useful to investors and creditors
C. Reduce company costs
D. Ensure profits
✅ Answer: B
2. Which is a primary qualitative characteristic?
A. Comparability
B. Verifiability
C. Relevance
D. Timeliness
✅ Answer: C
3. Faithful representation includes:
,A. Predictive value
B. Confirmatory value
C. Completeness
D. Timeliness
✅ Answer: C
4. Which assumption states that a business will continue operating?
A. Monetary unit
B. Going concern
C. Periodicity
D. Accrual
✅ Answer: B
5. Revenue recognition occurs when:
A. Cash is received
B. Performance obligation is satisfied
C. Invoice is sent
D. Contract signed
✅ Answer: B
Financial Statements
6. Which statement shows financial position?
A. Income statement
B. Balance sheet
C. Cash flow statement
D. Retained earnings
✅ Answer: B
, 7. Assets = Liabilities +:
A. Revenue
B. Equity
C. Expenses
D. Profit
✅ Answer: B
8. Which is a current asset?
A. Equipment
B. Inventory
C. Building
D. Land
✅ Answer: B
9. Retained earnings increase with:
A. Expenses
B. Dividends
C. Net income
D. Liabilities
✅ Answer: C
10. Which statement reports cash flows?
A. Balance sheet
B. Income statement
C. Cash flow statement
D. Equity statement
✅ Answer: C
Accounting Cycle
