3.01 Accounting
Which department maintains records of all business expenses?
A. accounting
B. communication
C. marketing
D. production
A. accounting
Kevin is a financial accountant, which means he provides his information primarily to:
A. competitors.
B. employees.
C. investors.
D. suppliers.
C. investors.
Since Justin needs to examine the methods used to reach his company’s goals, he wants to write a business plan to:
A. acquire funding.
B. prepare for an expansion.
C. implement a strategic plan.
D. place a value on the business.
C. implement a strategic plan.
The management plan component of a business plan addresses:
A. cash flow.
B. market research.
C. legal documents.
D. organizational structure.
D. organizational structure.
The Sarbanes-Oxley Act of 2002 mandates that:
A. CPAs take responsibility for the accuracy and completeness of corporate financial reports.
B. boards of directors take responsibility for the accuracy and completeness of corporate financial reports.
C. senior executives take individual responsibility for the accuracy and completeness of corporate financial reports.
D. each business will determine who should take responsibility for the accuracy and completeness of corporate financial reports.
B. boards of directors take responsibility for the accuracy and completeness of corporate financial reports.
Edwardo is the accounting manager at Firestone Tires. What does Edwardo use for financial planning purposes?
A. business policies
B. operating standards
C. accounting schedules
D. accounting information
D. accounting information
One reason ethics is important in accounting is because financial records can be:
A. reviewed by government agencies.
B. made available to the public.
C. interpreted in different ways.
D. communicated in writing.
C. interpreted in different ways.
In a business plan, where will Robert put the cost estimates and the effect of each on his company?
A. Financial Plan
B. Management Plan
C. Company Description
D. Strategy and Implementation
A. Financial Plan
Which is the most critical component of a business plan?
A. Financial Plan
B. Market Analysis
C. Executive Summary
D. Company Description
C. Executive Summary
What agency was created by the Sarbanes-Oxley Act to audit large publicly traded firms?
A. FASB (Financial Accounting Standard Board)
B. GAAP (General Accepted Accounting Principles)
C. PCAOB (Public Company Accounting Oversight Board)
D. SEC (Security and Exchange Commission)
C. PCAOB (Public Company Accounting Oversight Board)
Sweet Suzie’s Bakery had yearly sales equal to $85,000 and expenses equal to $122,000. Using these numbers, her accountant determined that the bakery had a net:
A. loss of $37,000.
B. loss of $207,000.
C. income of $37,000.
D. income of $207,000.
A. loss of $37,000.
The role of ethics in accounting is to serve as a:
A. flexible way of doing business.
B. guide for professional conduct.
C. logical way to make a decision.
D. method of analyzing a problem.
B. guide for professional conduct.
Which discusses how a company is intended to work in the future?
A. business plan
B. financial resource
C. product promotion
D. executive summary
A. business plan
Which document is least likely to be included in the financial plan component of a business plan?
A. credit history
B. balance sheet
C. income statement
D. cash flow statement
A. credit history
Which agency oversees the entire auditing industry?
A. Securities and Exchange Commission (SEC)
B. Financial Accounting Standards Board (FASB)
C. Association of International Accountants (AIA)
D. Public Company Accounting Oversight Board (PCAOB)
D. Public Company Accounting Oversight Board (PCAOB)
By subtracting total expenses from the gross margin, a business can determine its:
A. sales.
B. total liability.
C. owner’s income.
D. net income/loss.
D. net income/loss.
Ethical accounting professionals avoid conflicts of interest by:
A. authorizing changes.
B. behaving independently.
C. encouraging collaboration.
D. exhibiting biased attitudes.
B. behaving independently.
Fred wants his company to become the main supplier for a prominent local business. He should write a business plan to:
A. acquire funding.
B. place a value on the business.
C. assess a new product or promotion.
D. obtain a specific contract or agreement.
D. obtain a specific contract or agreement.
When writing a business plan, what is the most important thing to focus on?
A. format
B. content
C. page count
D. level of detail
B. content
A commonly recognized set of accounting guidelines for financial reporting in the United States that is responsible for investor confidence in the American markets is the:
A. Certified Accounting Practitioner (CAP).
B. Securities and Exchange Commission (SEC).
C. Financial Accounting Standards Board (FASB).
D. Generally Accepted Accounting Principles (GAAP).
D. Generally Accepted Accounting Principles (GAAP).
What is a common criticism of annual reports and letters to shareholders?
A. They contain too much financial information.
B. They are typically vague and full of jargon.
C. They are too short.
D. They are too long.
B. They are typically vague and full of jargon.
The basic principles that govern human behavior are:
A. ethics.
B. expectations.
C. ideas.
D. laws.
A. ethics.
In which section of the business plan will Elena put a copy of her business blueprint?
A. Appendix
B. Table of Contents
C. Executive Summary
D. Company Description
A. Appendix
What kind of data do existing businesses need to provide in the financial plan component of their business plans?
A. contracts and licenses
B. management résumés
C. historical financial data
D. competitive financial data
C. historical financial data
The Sarbanes-Oxley Act of 2002 was created in response to:
A. the Martha Stewart and Barclays scandals.
B. the Enron, WorldCom, and Arthur Andersen scandals.
C. the Madoff Ponzi scheme and the Bear Stearns Companies scandals.
D. the Swissair, Adelphia Communications, and Global Crossing scandals.
B. the Enron, WorldCom, and Arthur Andersen scandals.