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Introduction to Accounting Chapter Exam

Exam Instructions:

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Page 1

Question 1 1. Adam wants to find out the assets and liabilities of a company. Which financial statement should Adam read to find out this information?

Question 2 2. Which company, listed on the New York Stock Exchange would definitely be in breach of the Going Concern Principle?

Question 3 3. Which of the following would be the most significant contribution of technology to accounting?

Question 4 4. Which report in the financial statement would compare the assets to the sum of the liabilities and equity?

Question 5 5. Dan's organization stores their software applications and other information on a group of external computers known as virtual network servers. Employees often refer to this storage space as the _____.

Page 2

Question 6 6. Michael, the majority shareholder of a company, decided to produce the company's balance sheet whose cash balance included the cash in his own bank account. Would Michael be allowed to do this by GAAP?

Question 7 7. The Committee on Accounting Procedure is part of which organization?

Question 8 8. Monica reads in the newspaper that in the year ended December 31, 2015, Profit For Two Inc made $1 million profit. Monica wants to confirm for herself that this is really the case. What financial statement of Profit For Two Inc should Monica read to confirm the newspaper report?

Question 9 9. Bob is the CEO of ABC Hydraulics. Bob is committed to ethical business practices. He ensures that his investors are kept well-informed of the state of the company. As part of his commitment to transparency and ethical practices, he prefers that the top level executives don't see the inner workings of the company's financials so that they aren't tempted to try and defraud the company by embezzling. Is this complying with SOX (Sarbanes-Oxley Act)?

Question 10 10. In our ever-evolving world there have been many advances that have made accounting processes easier to complete; all of the following are examples of technology that have impacted the accounting industry except

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Question 11 11. Where will you find the total amount that is owed to your business by customers?

Question 12 12. You have invested $30,000 of your money into your company. In what part of the financial statements would you find this information?

Question 13 13. What does the term 'accounting' mean?

Question 14 14. While auditing a company, you find that several of its employees are not satisfied with their jobs. You decide not to write this in the report because of which of the following reasons?

Question 15 15. Ethics are defined as _____.

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Question 16 16. Which of the following is part of the accounting process?

Question 17 17. What has technology done to the accounting process?

Question 18 18. While creating a disaster plan, AccountInc decides that it needs off-site data storage. Which of the following would they use to store the information?

Question 19 19. What statement(s) do external and internal users of accounting information rely on?

Question 20 20. Djokovic is the Chief Information Officer for InfoTech Inc. Murray is the Chief Lending Officer at the Bank where InfoTech has a large bank loan. Which statement is true for both Djokovic and Murray, in connection with InfoTech?

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Question 21 21. Why is accounting important to business?

Question 22 22. Accountants use fixed accounting periods that are the same from year to year. Which principle are they maintaining by doing this?

Question 23 23. Which of the following is an example of how publicly-traded companies can apply the principle of conservatism with their financial statements?

Question 24 24. What was the accounting firm that made unethical choices in the Enron scandal?

Question 25 25. GAAP sets the standards for the creation of what?

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Question 26 26. Which type of external user would most commonly use audited financial statements?

Question 27 27. _____ and technology go hand in hand.

Question 28 28. Which of the following pieces of legislation is the result of the Enron scandal?

Question 29 29. Who is LEAST likely to use accounting reports for decision making?

Question 30 30. What is the formula for the basic accounting equation?

Introduction to Accounting Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next question. You can skip questions if you would like and come back to them later with the "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. You will lose your work if you close or refresh this page. Good luck!

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