Financial Accounting Final Exam
Questions and Answers Graded A+
The primary objective of financial accounting is to:
A) Know what, when, and how much product to produce.
B) Serve the decision-making needs of internal users.
C) Provide information on both the costs and benefits of looking after products and
services.
D) Provide accounting information that serves external users.
E) Monitor and control company activities. - Correct answer-D) Provide
accounting information that serves external users.
The accounting concept that requires financial statement information to be
supported by independent, unbiased evidence is:
A) Revenue recognition principle.
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,B) Time-period assumption.
C) Objectivity principle.
D) Going-concern assumption.
E) Business entity assumption. - Correct answer-C) Objectivity principle.
The accounting concept that requires every business to be accounted for separately
from other business entities, including its owner or owners is known as the:
A) Time-period assumption.
B) Revenue recognition principle.
C) Business entity assumption.
D) Cost principle.
E) Going-concern assumption. - Correct answer-C) Business entity assumption.
The accounting principle that requires accounting information to be based on
actual cost and requires assets and services to be recorded initially at the cash or
cash-equivalent amount given in exchange, is the:
A) Going-concern assumption.
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,B) Cost principle.
C) Realization principle.
D) Accounting equation.
E) Business entity assumption. - Correct answer-B) Cost principle.
Revenues are:
A) The costs of assets or services used.
B) Resources owned or controlled by a company.
C) The increase in equity from a company's sales of products and services.
D) The same as net income.
E) The excess of expenses over assets. - Correct answer-C) The increase in equity
from a company's sales of products and services.
Distributions of cash or other resources by a business to its stockholders are called:
A) Dividends.
B) Retained earnings.
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, C) Net Income.
D) Expenses.
E) Assets. - Correct answer-A) Dividends.
A financial statement providing information that helps users understand a
company's financial status, and which lists the types and amounts of assets,
liabilities, and equity as of a specific date, is called a(n):
A) Statement of cash flows.
B) Financial Status Statement.
C) Income statement.
D) Balance sheet.
E) Statement of retained earnings. - Correct answer-D) Balance sheet.
A business's record of the increases and decreases in a specific asset, liability,
equity, revenue, or expense is known as a(n)
A) Account.
B) Posting.
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Questions and Answers Graded A+
The primary objective of financial accounting is to:
A) Know what, when, and how much product to produce.
B) Serve the decision-making needs of internal users.
C) Provide information on both the costs and benefits of looking after products and
services.
D) Provide accounting information that serves external users.
E) Monitor and control company activities. - Correct answer-D) Provide
accounting information that serves external users.
The accounting concept that requires financial statement information to be
supported by independent, unbiased evidence is:
A) Revenue recognition principle.
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,B) Time-period assumption.
C) Objectivity principle.
D) Going-concern assumption.
E) Business entity assumption. - Correct answer-C) Objectivity principle.
The accounting concept that requires every business to be accounted for separately
from other business entities, including its owner or owners is known as the:
A) Time-period assumption.
B) Revenue recognition principle.
C) Business entity assumption.
D) Cost principle.
E) Going-concern assumption. - Correct answer-C) Business entity assumption.
The accounting principle that requires accounting information to be based on
actual cost and requires assets and services to be recorded initially at the cash or
cash-equivalent amount given in exchange, is the:
A) Going-concern assumption.
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,B) Cost principle.
C) Realization principle.
D) Accounting equation.
E) Business entity assumption. - Correct answer-B) Cost principle.
Revenues are:
A) The costs of assets or services used.
B) Resources owned or controlled by a company.
C) The increase in equity from a company's sales of products and services.
D) The same as net income.
E) The excess of expenses over assets. - Correct answer-C) The increase in equity
from a company's sales of products and services.
Distributions of cash or other resources by a business to its stockholders are called:
A) Dividends.
B) Retained earnings.
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, C) Net Income.
D) Expenses.
E) Assets. - Correct answer-A) Dividends.
A financial statement providing information that helps users understand a
company's financial status, and which lists the types and amounts of assets,
liabilities, and equity as of a specific date, is called a(n):
A) Statement of cash flows.
B) Financial Status Statement.
C) Income statement.
D) Balance sheet.
E) Statement of retained earnings. - Correct answer-D) Balance sheet.
A business's record of the increases and decreases in a specific asset, liability,
equity, revenue, or expense is known as a(n)
A) Account.
B) Posting.
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