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Financial Reporting And Analysis

Instructions:

Answer 35 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. The difference between net sales and the cost of goods sold
Income from Operations
Income Taxes
Gross Margin
Debit to Equity

2. Current assets - current liabilities = working capital
Profit Margin
Working Capital
Current Ratio
Long-term Liabilities

3. Benefit gained from providing information should be greater than the cost of providing it
Profit Margin
Operating Expenses
Long-term Liabilities
Cost Benefit

4. Total cash sales and total credit sales during an accounting period
Gross Sales
Sales Returns and Allowances
Net Sales
Understandability

5. Expenses for accounting - personal - credit checking - collections - and other expenses that apply to insure expenses
Consistency
Operating Expenses
Income Taxes
General and Administrative Expenses

6. Requires all financial statements presents all information relevant to users understanding of statements
Full Disclosure
Other Revenues and Expenses
Understandability
Net Sales

7. Accounts reflect the amount of assets invested by stockholders
Operating Expenses
Current Assets
Consistency
Contributed Capital

8. Net income / net sales
Long-term Liabilities
Asset Turnover
Profit Margin
Normal Operating Cycle

9. The average time it needs to go from spending cash to receiving cash
Return on Equity
Long-term Liabilities
Normal Operating Cycle
Consistency

10. The relative importance of an item or event
Current Ratio
Profit Margin
Materiality
Retained Earnings

11. Cost of storing goods and preparing them for sale
Gross Margin
Net Sales
Selling Expenses
Qualitative Characteristics

12. Net income / (average owner's equity/2)
Full Disclosure
Return on Equity
Consistency
Gross Margin

13. Tangible long-term assets used in a business day to day operations
Other Revenues and Expenses
Selling Expenses
Property - Plant - and Equipment
Comparability

14. Net sales / (average total assets/2)
Asset Turnover
Debit to Equity
Long-term Liabilities
Contributed Capital

15. Net income / (average total assets/2)
Return on Assets
Gross Sales
Gross Margin
Net Income

16. Assets usually long term that are not used in normal business operations and management does not plan to convert to cash within the next year
Property - Plant - and Equipment
Investments
Long-term Liabilities
Other Revenues and Expenses

17. FASB established standards to facilitate interpretation of accounting information
Materiality
Cost Benefit
Qualitative Characteristics
Investments

18. Final figure of an income statement
Materiality
Retained Earnings
Sales Returns and Allowances
Net Income

19. The expense for federal - state - and local taxes on corporate income
Income Taxes
Conservation
Debit to Equity
Gross Sales

20. Information presented in such a way that decision makers can recognize similarities - differences - and trends over different periods
General and Administrative Expenses
Long-term Liabilities
Sales Returns and Allowances
Comparability

21. Represents the stockholder's claim to the assets that are earned from operations and reinvested in corporate operations
Retained Earnings
Normal Operating Cycle
Consistency
Selling Expenses

22. Cash refunds - credit on account - and discounts from selling prices made to customers who have received defective products or products that are otherwise unsatisfactory
Return on Equity
Conservation
Sales Returns and Allowances
Income Taxes

23. Accountants prepare financial statements in accordance with practices that are intended to make the information understandable
Long-term Liabilities
Full Disclosure
Property - Plant - and Equipment
Understandability

24. Difference between gross margin and operating expense
Income Taxes
Income from Operations
Comparability
Property - Plant - and Equipment

25. Expenses incurred in running a business other than the cost of goods sold
Net Income
Cost of goods sold
Cost Benefit
Operating Expenses

26. Current assets / current liabilities
Full Disclosure
Sales Returns and Allowances
Current Ratio
Normal Operating Cycle

27. When a choice between 2 equally acceptable procedures - choose the one least like to overstate assets or income
Property - Plant - and Equipment
Full Disclosure
Conservation
Net Sales

28. Not related to a company's operating activities
Retained Earnings
Other Revenues and Expenses
Comparability
Cost Benefit

29. Cash and other asset that a company can reasonably expect to covert to cash. sell - or consumer within 1 year
Current Assets
Selling Expenses
Cost Benefit
Qualitative Characteristics

30. Amount a merchandiser paid for the merchandise it sold during an accounting period
Cost of goods sold
General and Administrative Expenses
Materiality
Normal Operating Cycle

31. Once a company adopted an accounting procedure - it must use it from one period to the next
Retained Earnings
Consistency
Materiality
Understandability

32. Obligations that must be satisfied within 1 year or within normal operating cycle
Contributed Capital
Net Sales
Cost of goods sold
Current Liabilities

33. Gross proceeds from sales less sales returns and allowance and any discounts allowed
Operating Expenses
Investments
Return on Assets
Net Sales

34. Total liabilities / owner's equity
Property - Plant - and Equipment
Understandability
Debit to Equity
Gross Margin

35. Debts that fall due more than 1 year in the future or beyond the normal operating cycle
Selling Expenses
Income Taxes
Cost of goods sold
Long-term Liabilities