Accounting 2220 Exam #1 BGSU 100% Correct!!Financial Accounting - Answer provides information used primarily by investors, creditors, and others outside a business Managerial Accounting - Answer information used by executives, managers, and employees who work inside the business GAAP - Answer generally accepted accounting principles Balance Sheet - Answer asset + liability = equity at a specific point in time Income Statement - Answer revenues - expenses = net income over a specific accounting period Statement of Cash Flow - Answer cash flow from operations - cash flow from operating, financing, and investing = cash flow over a specific accounting period Product Costs - Answer direct materials, direct labor, and manufacturing overhead Period Costs - Answer not a necessary part of the manufacturing process Corporate Governance - Answer set of relationships between board of directors, management, shareholders, auditors, and other stakeholders that determines how a company is operated Internal Controls - Answer policies and procedures that a business implements to reduce opportunities for fraud and to ensure that its objectives will be accomplished Fraud Triangle - Answer opportunity, pressure, rationalization Sarbanes-Oxley Act - Answer act passed by U.S. Congress in 2002 to protect investors from the possibility of fraudulent accounting activities by corporations PCAOB (Public Company Accounting Oversight Board) - Answer private- sector, nonprofit corporation created by the SOX Act to oversee accounting professionals who provide independent audit reports for publicly traded companies Statement of Ethical Professional Practice - Answer competence, confidentiality, integrity, and credibility Fixed Cost - Answer remain the same regardless of production output Variable Cost - Answer costs that vary depending on a company's production volume
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