Multiple Choice Questions
81. Accounting is an information and measurement system that does all of the following
except:
A. Identifies business activities.
B. Records business activities.
C. Communicates business activities.
D. Eliminates the need for interpreting financial data .
E. Helps people make better decisions.
82. Technology:
A. Has replaced accounting.
B. Has not improved the clerical accuracy of accounting.
C. Reduces the time, effort and cost of recordkeeping.
D. In accounting has replaced the need for decision makers.
E. In accounting is only available to large corporations.
83. The primary objective of financial accounting is to:
A. Serve the decision-making needs of internal users.
B. Provide accounting information that serves external users.
C. Monitor and control company activities.
D. Provide information on both the costs and benefits of looking after products and services.
E. Know what, when, and how much product to produce.
84. The area of accounting aimed at serving the decision making needs of internal users is:
A. Financial accounting.
B. Managerial accounting.
C. External auditing.
D. SEC reporting.
E. Bookkeeping.
85. External users of accounting information include all of the following
except:
A. Shareholders.
B. Customers.
C. Purchasing managers.
D. Government regulators.
E. Creditors.
86. All of the following regarding a Certified Public Accountant are true
except:
A. Must meet education and experience requirements.
B. Must pass an examination.
C. Must exhibit ethical character.
D. May also be a Certified Management Accountant.
E. Cannot hold any certificate other than a CPA.
87. Ethical behavior requires that:
A. Auditors’ pay not depend on the successof the client’s business.
B. Auditors invest in businesses they audit.
C. Analysts report information favorable to their companies.
D. Managers use accounting information to benefit themselves.
E. Auditors’ pay depends on the success of the client’s business.
88. The conceptual framework that the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) are attempting to converge and enhance includes the following broad areas to guide standard setting
except:
A. Objectives
B. Qualitative characteristics
C. Uniformity
D. Elements
E. Recognition and measurement
89. All of the following are true regarding ethicsexcept:
A. Ethics are beliefs that separate right from wrong.
B. Ethicsrules are often set for CPAs.
C. Ethics do not affect the operations or outcome of a company.
D. Are critical in accounting.
E. Ethics can be difficult to apply.
90. The accounting concept that requires financial statement information to be supported by independent, unbiased evidence is:
A. Business entity assumption.
B. Revenue recognition principle.
C. Going-concern assumption.
D. Time-period assumption.
E. Objectivity principle