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Financial Accounting, 6th Edition
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Chapters 1 – 12 Complete
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By David Spiceland, Wayne Thomas and Don Herrmann
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,TABLE OF CONTENTS w w w
Chapter 1: A Framework for Financial Accounting
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Chapter 2: The Accounting Cycle: During the Period
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Chapter 3: The Accounting Cycle: End of the Period
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Chapter 4: Cash and Internal Controls
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Chapter 5: Receivables and Sales
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Chapter 6: Inventory and Cost of Goods Sold
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Chapter 7: Long-Term Assets
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Chapter 8: Current Liabilities
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Chapter 9: Long-Term Liabilities
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Chapter 10: Stockholders’ Equity
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Chapter 11: Statement of Cash Flows
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Chapter 12: Financial Statement Analysis
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,Chapter 1 A Framework for Financial Accounting
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1) Accounting is a system of maintaining records of a company's operations and communicatingthat
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information to decision makers.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
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2) Accounting information is used by investors to decide whether to invest in a company's stock.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
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3) Accounting information is used by creditors to decide whether to invest in acompany's stock.
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Answer: FALSE w
Explanation: Creditors lend money to a company. w w w w w w
Difficulty: 1 Easy
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Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
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4) The primary functions of financial accounting are to measure business activities of a companyand to
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communicate those measurements to internal parties for decision-making purposes.
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Answer: FALSE w
Explanation: Financial accounting primarily serves to provide information to external parties.Difficulty:
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2 Medium
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Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Understand
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
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, 5) Financing activities are transactions involving external sources of funding.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
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Bloom's: Remember AACSB: w w
Reflective ThinkingAICPA:
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wFN Measurement
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6) Investing activities include the purchase and sale of long-term resources.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
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Bloom's: Remember AACSB: w w
Reflective ThinkingAICPA:
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wFN Measurement
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7) Operating activities include transactions that relate to the primary operations of the company.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
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Bloom's: Remember AACSB: w w
Reflective ThinkingAICPA:
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wFN Measurement
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8) A corporation is an entity that is legally separate from its owners.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
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Bloom's: Remember AACSB:www w
Reflective ThinkingAICPA:
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BBCritical Thinking
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Financial Accounting, 6th Edition
w w w w
Chapters 1 – 12 Complete
w w w w
By David Spiceland, Wayne Thomas and Don Herrmann
w w w w w w w
,TABLE OF CONTENTS w w w
Chapter 1: A Framework for Financial Accounting
w w w w w w
Chapter 2: The Accounting Cycle: During the Period
w w w w w w w
Chapter 3: The Accounting Cycle: End of the Period
w w w w w w w w
Chapter 4: Cash and Internal Controls
w w w w w
Chapter 5: Receivables and Sales
w w w w
Chapter 6: Inventory and Cost of Goods Sold
w w w w w w w
Chapter 7: Long-Term Assets
w w w
Chapter 8: Current Liabilities
w w w
Chapter 9: Long-Term Liabilities
w w w
Chapter 10: Stockholders’ Equity
w w w
Chapter 11: Statement of Cash Flows
w w w w w
Chapter 12: Financial Statement Analysis
w w w w
,Chapter 1 A Framework for Financial Accounting
w w w w w w
1) Accounting is a system of maintaining records of a company's operations and communicatingthat
w w w w w w w w w w w w w
information to decision makers.
w w w w
Answer: TRUE w
Difficulty:1Easy
w w w
Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
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2) Accounting information is used by investors to decide whether to invest in a company's stock.
w w w w w w w w w w w w w w
Answer: TRUE w
Difficulty:1Easy
w w w
Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Remember
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
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3) Accounting information is used by creditors to decide whether to invest in acompany's stock.
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Answer: FALSE w
Explanation: Creditors lend money to a company. w w w w w w
Difficulty: 1 Easy
w w w
Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Remember
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AACSB: Reflective Thinking
w w
AICPA: BB Critical Thinking
w w w w
4) The primary functions of financial accounting are to measure business activities of a companyand to
w w w w w w w w w w w w w w w
communicate those measurements to internal parties for decision-making purposes.
w w w w w w w w w
Answer: FALSE w
Explanation: Financial accounting primarily serves to provide information to external parties.Difficulty:
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2 Medium
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Topic: Defining Accounting
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Learning Objective: 01-01 Describe thetwo primary functions of financial accounting.Bloom's:
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Understand
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AACSB: Reflective Thinking
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AICPA: BB Critical Thinking
w w w w
, 5) Financing activities are transactions involving external sources of funding.
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Answer: TRUE w
Difficulty:1Easy
w w w
Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
w w w w w w w w w w
Bloom's: Remember AACSB: w w
Reflective ThinkingAICPA:
w w w
wFN Measurement
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6) Investing activities include the purchase and sale of long-term resources.
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Answer: TRUE w
Difficulty:1Easy
w w w
Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
w w w w w w w w w w
Bloom's: Remember AACSB: w w
Reflective ThinkingAICPA:
w w w
wFN Measurement
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7) Operating activities include transactions that relate to the primary operations of the company.
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Answer: TRUE w
Difficulty:1Easy
w w w
Topic: Measuring Business Activities
w w w
Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
w w w w w w w w w w
Bloom's: Remember AACSB: w w
Reflective ThinkingAICPA:
w w w
wFN Measurement
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8) A corporation is an entity that is legally separate from its owners.
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Answer: TRUE w
Difficulty:1Easy
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Topic: Measuring Business Activities
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Learning Objective: 01-02 Understand the business activities that financial accountingmeasures.
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Bloom's: Remember AACSB:www w
Reflective ThinkingAICPA:
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BBCritical Thinking
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