Financial and Managerial Accounting Information for Decisions 4th Edition by Wild
Wild’s Financial and Managerial Accounting responds to the market’s request for a single book with balanced financial and managerial content (~50/50) that has a corporate approach throughout. Its innovation is reflected in its extensive use of small business examples, the integration of new technology learning tools, superior end-of-chapter material, and a highly engaging, pedagogical design.
Free Test Bank for Financial and Managerial Accounting Information for Decisions 4th Edition Part 2 by Wild
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Test Bank for Financial and Managerial Accounting Information for Decisions 4th Edition Part 1 by Wild
Planning refers to defining an organization's ideas, goals and actions.
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The International Accounting Standards Board (IASB) is the government group that establishes reporting requirements for companies that issue stock to the public.
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False
Investing activities are the acquiring and selling of resources that an organization uses in its everyday operations.
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False
Understanding generally accepted accounting principles is not necessary when using and interpreting financial statements.
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Every business transaction should leave the accounting equation in balance.
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False
The business entity assumption requires that a business be accounted for separately from other business entities, including its owner or owners.
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Bookkeeping is the sole purpose of accounting.
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False
According to the cost principle, it is preferable for managers to report the most current estimate of an asset's value.
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The balance sheet shows whether or not the firm achieved its primary objective of earning a profit.
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Risk is the amount of uncertainty about the return we expect to earn in the future.
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Internal users of accounting information include lenders, shareholders, brokers and managers.
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Owner financing refers to resources contributed by creditors or lenders.
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The primary objective of financial accounting is to provide general-purpose financial statements to help external users analyze and interpret an organization's activities.
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Auditors are banned from direct investments with their clients.
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Reebok's net income of $119 million and average assets of $1,400 million results in a return on assets of 8.5%.
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Operating activities include long-term borrowing and repaying cash from lenders and cash investments by owners or dividends to the owner.
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The four basic financial statements include the balance sheet, income statement, statement of retained earnings and statement of cash flows.
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Return on assets is useful to decision makers for evaluating management, analyzing and forecasting profits and in planning activities.
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The income statement shows the financial position of a business on a specific date.
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Generally accepted accounting principles are the basic assumptions, concepts and guidelines for preparing financial statements.
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Ownership of a corporation is divided into units called shares or stock.
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Dividends are expenses of a business.
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An owner's investment in a business always creates an asset (cash), a liability (note payable) and an equity (common stock).
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The internal operating functions of businesses include research and development, distribution and human resources.
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Unlimited liability is an advantage of all sole proprietorships.
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The accounting equation implies that: Assets + Liabilities = Equity.
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Accounting is an information and measurement system that identifies records and communicates financial information to users.
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The legitimate claims of a business's creditors take precedence over the claims of its stockholders.
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The Financial Accounting Standards Board is a private group that sets both broad and specific accounting principles.
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An external audit report is a professional opinion about whether the financial statements are prepared according to generally accepted accounting principles.
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The first section of the income statement reports cash from operations.
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The statement of cash flows shows the net effect of revenues and expenses for a reporting period.
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The income statement is a financial statement that shows revenues earned and expenses incurred during a specified period of time.
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Managerial accounting is an area of accounting that provides internal reports to assist the decision making needs of internal users.
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The three major activities of a business are operating, investing and financing.
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Revenues are increases in retained earnings from a company's earnings activities.
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The purchase of supplies must appear on the statement of cash flows as an investing activity because it involves the purchase of assets.
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Owner's investments and dividends are reported on the income statement.
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Assets are the resources owned or controlled by a business.
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Expenses decrease retained earnings and are the costs acquired to earn revenues.
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The International Accounting Standards Board (IASB) issues International Financial Reporting Standards (IFRS) that identify preferred accounting practices.
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The Securities and Exchange Commission (SEC) is an agency of the federal government that establishes reporting requirements for companies that issue stock to the public.
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The International Accounting Standards Board (IASB) has the authority to impose its standards on companies around the world.
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Investing activities involve the buying and selling of assets such as land and equipment that are held for long-term use in the business.
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The balance sheet is based on the accounting equation.
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A balance sheet covers a period of time, such as a month or year.
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The Retained earnings is increased when cash is received from customers in payment of previously recorded accounts receivable.
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The accounting equation can be restated as: Assets - Equity = Liabilities.
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A net loss arises when revenues exceed expenses.
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Accounting is one way important information about businesses are reported to decision makers.
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False