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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. Accountants prepare financial statements in accordance with practices that are intended to make the information understandable
Working Capital
Selling Expenses
Understandability
Cost of goods sold

2. Total liabilities / owner's equity
Gross Margin
Other Revenues and Expenses
Asset Turnover
Debit to Equity

3. The expense for federal - state - and local taxes on corporate income
Income Taxes
Other Revenues and Expenses
Investments
Gross Margin

4. Obligations that must be satisfied within 1 year or within normal operating cycle
Normal Operating Cycle
Current Liabilities
Materiality
Understandability

5. Information presented in such a way that decision makers can recognize similarities - differences - and trends over different periods
Comparability
Operating Expenses
Gross Margin
Net Sales

6. Expenses for accounting - personal - credit checking - collections - and other expenses that apply to insure expenses
Gross Margin
Property - Plant - and Equipment
General and Administrative Expenses
Selling Expenses

7. Current assets - current liabilities = working capital
Working Capital
Current Liabilities
Current Ratio
Income Taxes

8. Benefit gained from providing information should be greater than the cost of providing it
Property - Plant - and Equipment
Current Assets
Asset Turnover
Cost Benefit

9. The average time it needs to go from spending cash to receiving cash
Full Disclosure
Working Capital
Net Sales
Normal Operating Cycle

10. When a choice between 2 equally acceptable procedures - choose the one least like to overstate assets or income
Current Liabilities
General and Administrative Expenses
Return on Assets
Conservation

11. FASB established standards to facilitate interpretation of accounting information
Qualitative Characteristics
Current Ratio
Materiality
Profit Margin

12. Net sales / (average total assets/2)
Asset Turnover
Full Disclosure
Long-term Liabilities
Property - Plant - and Equipment

13. Expenses incurred in running a business other than the cost of goods sold
General and Administrative Expenses
Operating Expenses
Investments
Retained Earnings

14. Debts that fall due more than 1 year in the future or beyond the normal operating cycle
Long-term Liabilities
Cost Benefit
Consistency
Income from Operations

15. Accounts reflect the amount of assets invested by stockholders
General and Administrative Expenses
Contributed Capital
Net Income
Sales Returns and Allowances

16. Net income / (average total assets/2)
Income Taxes
Property - Plant - and Equipment
Return on Assets
Return on Equity

17. Total cash sales and total credit sales during an accounting period
Gross Sales
Other Revenues and Expenses
Asset Turnover
Long-term Liabilities

18. Gross proceeds from sales less sales returns and allowance and any discounts allowed
Qualitative Characteristics
Asset Turnover
Net Sales
Net Income

19. Cost of storing goods and preparing them for sale
Net Sales
Working Capital
Selling Expenses
Other Revenues and Expenses

20. Difference between gross margin and operating expense
Contributed Capital
Income from Operations
Other Revenues and Expenses
Sales Returns and Allowances

21. Once a company adopted an accounting procedure - it must use it from one period to the next
Gross Sales
Net Sales
Consistency
Cost Benefit

22. Final figure of an income statement
Net Income
Long-term Liabilities
Asset Turnover
Gross Margin

23. Tangible long-term assets used in a business day to day operations
Current Ratio
Property - Plant - and Equipment
Long-term Liabilities
Net Income

24. The difference between net sales and the cost of goods sold
Return on Equity
Net Income
Gross Margin
Contributed Capital

25. Net income / net sales
Long-term Liabilities
Other Revenues and Expenses
Profit Margin
Current Assets

26. Cash and other asset that a company can reasonably expect to covert to cash. sell - or consumer within 1 year
Net Income
Retained Earnings
Operating Expenses
Current Assets

27. Requires all financial statements presents all information relevant to users understanding of statements
Income from Operations
Long-term Liabilities
Cost of goods sold
Full Disclosure

28. Cash refunds - credit on account - and discounts from selling prices made to customers who have received defective products or products that are otherwise unsatisfactory
Cost Benefit
Full Disclosure
Current Assets
Sales Returns and Allowances

29. The relative importance of an item or event
Selling Expenses
Conservation
Current Ratio
Materiality

30. Amount a merchandiser paid for the merchandise it sold during an accounting period
Cost of goods sold
Property - Plant - and Equipment
Net Sales
General and Administrative Expenses

31. Current assets / current liabilities
Cost Benefit
Current Ratio
Other Revenues and Expenses
Sales Returns and Allowances

32. Not related to a company's operating activities
General and Administrative Expenses
Profit Margin
Materiality
Other Revenues and Expenses

33. 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
Operating Expenses
Other Revenues and Expenses
Investments
Selling Expenses

34. Net income / (average owner's equity/2)
Cost Benefit
Property - Plant - and Equipment
Materiality
Return on Equity

35. Represents the stockholder's claim to the assets that are earned from operations and reinvested in corporate operations
Qualitative Characteristics
Comparability
Retained Earnings
Conservation