Question 1

____ is the process of recording financial transactions in a general journal.

Accepted Answer

A)   Recording
B)   Transcribing
C)   Entering
D)   Journalizing
E)   PostingF) B) and E)
G) None of the above

Question 2

The value of a firm's reputation, location, earning capacity, and other intangibles that make the business profitable is called its _____.

Accepted Answer

A)   good character
B)   franchise
C)   goodwill
D)   distinction
E)   prestigeF) C) and D)
G) None of the above

Question 3

Wal-Mart takes its net sales and subtracts the cost of goods sold during the previous period.The result is Wal-Mart's _____.

Accepted Answer

A)   gross sales
B)   net income
C)   gross profit
D)   net margin
E)   net purchasesF) C) and E)
G) A) and D)

Question 4

Marilyn provides piano lessons to students in her home four days a week.The money she earns from providing these services would be called ____ on an income statement.

Accepted Answer

A)   expenses
B)   cash
C)   revenues
D)   retained earnings
E)   equityF) All of the above
G) A) and B)

Question 5

According to the Occupational Outlook Handbook, job opportunities for accountants, auditors, and managers in the accounting area are expected to experience average growth between now and the year 2016.

Accepted Answer

A) True 
 B)False

Question 6

Heather is a stockholder of Eddie Bauer.From her perspective, the best indicator of Eddie Bauer's success is the _____.

Accepted Answer

A)   return on inventory
B)   acid-test ratio
C)   debt-to-equity ratio
D)   earnings per share
E)   current ratioF) A) and D)
G) C) and D)

Question 7

Cash, marketable securities, notes receivable, and merchandise inventory are examples of _____.

Accepted Answer

A)   current assets
B)   expenses
C)   acid-test assets
D)   fixed assets
E)   overhead costsF) B) and C)
G) None of the above

Question 8

The cost of goods sold equals beginning inventory plus net purchases minus ending inventory.

Accepted Answer

A) True 
 B)False

Question 9

When Betty Tran prepared a personal income statement, the remainder or residual value is called _____.

Accepted Answer

A)   net asset total
B)   total assets
C)   total revenues
D)   retained earnings
E)   cash surplusF) A) and B)
G) A) and E)

Question 10

The ratio obtained by dividing net income after taxes by net sales is the _____.

Accepted Answer

A)   return on sales ratio
B)   acid-test ratio
C)   return on equity ratio
D)   earnings per share
E)   working capitalF) B) and D)
G) A) and B)

Question 11

Managers and other groups interested in a business firm's financial records must be able to "trust the numbers." Unfortunately, a large number of accounting scandals have caused people to doubt the numbers.Why do you think corporate executives "cook" their company's books?

Accepted Answer

There are several reasons why corporate ...

Question 12

KYZ Radio pays salaries, rent, insurance, and utilities each month.These are all _____.

Accepted Answer

A)   current assets
B)   operating expenses
C)   cost of merchandise sold
D)   fixed liabilities
E)   None of the above are correct.F) A) and B)
G) A) and E)

Question 13

Mallard Decoy Manufacturing has total liabilities of $40,000 and total assets of $120,000.The owners' equity for the firm is $100,000.What is the firm's debt-to-owners' equity ratio?

Accepted Answer

A)   83 percent
B)   40 percent
C)   33 percent
D)   3 percent
E)   1.2 percentF) B) and E)
G) B) and C)

Question 14

Today much of the pressure on corporate executives to "cook" the books is driven by the desire to look good to Wall Street analysts and investors.

Accepted Answer

A) True 
 B)False

Question 15

General Motors decides to close one of its manufacturing plants in the Midwest.GM sells the facility to a new foreign automobile manufacturer.The money GM receives from this sale would belong in the ____ section of the statement of cash flows.

Accepted Answer

A)   operating
B)   investing
C)   business
D)   selling
E)   financingF) None of the above
G) C) and D)

Question 16

If you wanted to evaluate the financial condition of Target Stores, a leading discount chain, you would most likely compare its financial ratios to ____ ratios.

Accepted Answer

A)   Wal-Mart's
B)   JCPenney's
C)   General Electric's
D)   small retailer industry's average
E)   Target in future yearsF) B) and E)
G) A) and E)

Question 17

GAAP is an abbreviation that stands for generally accepted accounting principles.

Accepted Answer

A) True 
 B)False

Question 18

The certified management accountant exam is designed to develop and measure not only accounting skills but also decision-making and critical-thinking skills.

Accepted Answer

A) True 
 B)False

Question 19

Jessica has worked for one week but her employer only pays its employees every two weeks.The amount of money her company owes her is classified as _____.

Accepted Answer

A)   accounts notable
B)   accounts receivable
C)   notes payable
D)   prepaid wages
E)   salaries payableF) B) and D)
G) B) and C)

Question 20

Long-term liabilities need not be repaid for at least one year.

Accepted Answer

A) True 
 B)False

Exam 15: Using Accounting Information

Mallard Decoy Manufacturing has total liabilities of $40,000 and total assets of $120,000.The owners' equity for the firm is $100,000.What is the firm's debt-to-owners' equity ratio?

Correct AnswerverifiedShow Answer

Long-term liabilities need not be repaid for at least one year.

Correct AnswerverifiedShow Answer

Heather is a stockholder of Eddie Bauer.From her perspective, the best indicator of Eddie Bauer's success is the _____.

Correct AnswerverifiedShow Answer

The value of a firm's reputation, location, earning capacity, and other intangibles that make the business profitable is called its _____.

Correct AnswerverifiedShow Answer

KYZ Radio pays salaries, rent, insurance, and utilities each month.These are all _____.

Correct AnswerverifiedShow Answer

____ is the process of recording financial transactions in a general journal.

Correct AnswerverifiedShow Answer

Wal-Mart takes its net sales and subtracts the cost of goods sold during the previous period.The result is Wal-Mart's _____.

Correct AnswerverifiedShow Answer

The certified management accountant exam is designed to develop and measure not only accounting skills but also decision-making and critical-thinking skills.

Correct AnswerverifiedShow Answer

Marilyn provides piano lessons to students in her home four days a week.The money she earns from providing these services would be called ____ on an income statement.

Correct AnswerverifiedShow Answer

Cash, marketable securities, notes receivable, and merchandise inventory are examples of _____.

Correct AnswerverifiedShow Answer

Today much of the pressure on corporate executives to "cook" the books is driven by the desire to look good to Wall Street analysts and investors.

Correct AnswerverifiedShow Answer

According to the Occupational Outlook Handbook, job opportunities for accountants, auditors, and managers in the accounting area are expected to experience average growth between now and the year 2016.

Correct AnswerverifiedShow Answer

If you wanted to evaluate the financial condition of Target Stores, a leading discount chain, you would most likely compare its financial ratios to ____ ratios.

Correct AnswerverifiedShow Answer

The cost of goods sold equals beginning inventory plus net purchases minus ending inventory.

Correct AnswerverifiedShow Answer

Jessica has worked for one week but her employer only pays its employees every two weeks.The amount of money her company owes her is classified as _____.

Correct AnswerverifiedShow Answer

GAAP is an abbreviation that stands for generally accepted accounting principles.

Correct AnswerverifiedShow Answer

When Betty Tran prepared a personal income statement, the remainder or residual value is called _____.

Correct AnswerverifiedShow Answer

The ratio obtained by dividing net income after taxes by net sales is the _____.

Correct AnswerverifiedShow Answer

Managers and other groups interested in a business firm's financial records must be able to "trust the numbers." Unfortunately, a large number of accounting scandals have caused people to doubt the numbers.Why do you think corporate executives "cook" their company's books?

Correct AnswerAnswered by ExamLex AIThere are several reasons why corporate ...View AnswerShow Answer

General Motors decides to close one of its manufacturing plants in the Midwest.GM sells the facility to a new foreign automobile manufacturer.The money GM receives from this sale would belong in the ____ section of the statement of cash flows.

Correct AnswerverifiedShow Answer

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There are several reasons why corporate ...
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