WGU C213 ACCOUNTING FOR DECISION MAKERS

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WGU C213 ACCOUNTING FOR DECISION MAKERS

FINAL EXAM STUDY GUIDE

QUESTIONS AND VERIFIED ANSWERS / A+ GRADE

• Which of the following is NOT true of the Financial Accounting Standards

Board (FASB)?: It is a government agency

THEY DO:

It consists of seven full-time members It seeks consistency for its proposed standards It has no legal power to enforce the standards it sets

• Generally accepted accounting principles are: Developed by accounting rule makers

3. The initials GAAP stand for: Generally Accepted Accounting Principles

• The current standard-setting board for accounting in the private sector is the:

Financial Accounting Standards Board (FASB)

• The emphasis in financial accounting is on which of the following external user

groups?: Investors and creditors

6. The primary internal group that uses accounting information is: Manage- ment

7. Internal reports are generally used by: Management

• Which of the following is NOT an external user of financial information?: - 1 / 4

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Management

• Standards established by the International Accounting Standards Board are referred

to as: International Financial Reporting Standards

• Which of the following is the government agency that stipulates the rules and

regulations that govern the collection of taxes in the United States?: In- ternal Revenue Service

• Which of the following is NOT a service typically provided by large public

accounting firms?: Making management decisions

They DO: Performing

audits Establishing accounting systems Redesigning operating procedures

12. The initials CPA stand for: Certified Public Accountant

• Which of the following organizations has specific legal authority to es- tablish

accounting standards for publicly held companies?: Securities and Exchange

Commission (SEC)

• Which of the following is NOT a reason for the integration of worldwide

accounting standards?: the increased efficiency of financial markets

NOT 2 / 4

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the integration of the global economy the theoretical necessity of a common set of accounting standards the need to evaluate investments across the world

• The International Accounting Standards Board (IASB) is charged with

developing worldwide accounting practices?: True

• With the current state of information technology, investors outside a com- pany are

now allowed access to a company's internal database of financial information and do

their own customized analysis of a firm's performance.: - False

• Increased federal oversight of the audit process resulted from the passage of the

following act of Congress: Sarbanes-Oxley Act

• A borrower benefits from providing financial information regarding income and

expenses in the form of a lower interest rate on the loan because of reduced

uncertainty for the lender with regard to repayment.: True

• Which of the following is NOT one of the three primary financial state-

ments?: The Statement of Retained Earnings

THEY ARE:

The Balance Sheet The Statement of Cash Flows The Income Statement

• One reason for a company's preparing and providing financial statements is to

reduce uncertainty for an investor regarding the firm's future financial performance.: True

• Which of the following types of accounts are NOT found on the balance sheet?:

Revenues

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THEY ARE

Assets Liabilities Owners' equity

22. Another name for the balance sheet is the: Statement of financial position

• Which of the following distinguishes between current and long-term as- sets?:

Classified balance sheet

24. The basic accounting equation is: Assets = Liabilities + Owners' Equity

• The idea that businesses must be accounted for as though they will exist at least

for the foreseeable future is the: Going concern concept

• Expenses generally cause: A decrease in net assets
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