Chapter 16: Accounting
Multiple Choice

1.  

Together the world's five largest accounting firms are responsible for auditing _____ of all publicly held corporations.
80 percent
90 percent
72 percent
78 percent

2.  

Which of the following puts pressure on accountants to expand their skills and services?
Technological advances
Market value shifts
Non-CPA competitors
All of the above

3.  

The highest-ranking accountant in a company, overseeing all accounting functions is the ...
cost accountant.
tax accountant.
controller.
financial analyst.

4.  

Which of the following is NOT a guiding concept accountants use in their work?
The fundamental accounting equation
The cash-flow principle
Double-entry bookkeeping
The matching principle

5.  

Which of the following is NOT a type of financial statement?
Forecasting statement of projected earnings
Balance sheet
Income statement
Cash-flow report

6.  

Amounts owed by the company that are to be repaid within one year are ...
current assets.
fixed assets.
current liabilities.
none of the above.

7.  

The costs involved in producing or acquiring products for sale during a given period is known as ...
operating expenses.
retained earnings.
cost of goods sold.
none of the above.

8.  

Operating expenses associated with marketing products are known as ...
general expenses.
inventory turnover ratios.
selling expenses.
none of the above.

9.  

Financial analysis involves ...
entering financial data into an electronic spreadsheet.
converting total costs to unit costs.
projecting a range of outcomes using various scenarios.
all of the above.

10.  

Current assets minus current liabilities equals a company's ...
liquidity ratio.
working capital.
profitability ratio.
debt-to-equity ratio.

11.  

Accountants ...
design accounting systems.
interpret tax law.
prepare tax returns.
all of the above.

12.  

Now that many accounting tasks are automated, accountants can redirect their efforts to helping clients ...
improve their business process.
analyze profitability.
evaluate product performance.
all of the above.

13.  

The simple accounting equation ...
is Assets = Liabilities + Owners' equity.
is the framework for the entire accounting process.
suggests that creditors or owners provide all the assets in a corporation.
all of the above.

14.  

Outsiders use a company's annual report to ...
make investment decisions.
make supplier decisions.
make job-seeking decisions.
all of the above.

15.  

A cash-flow statement shows how cash was received and spent in which of the following areas?
Operations
Investments
Financing
All of the above


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