BUS10 Chp. 17

On a balance sheet, assets are listed in order, from the most liquid to the least liquid
True
The accounts receivable turnover estimates the number of times a firm sells and replaces its inventory each year
False
The statement of financial position presents the business firm’s assets, liabilities, and owners’ equity accounts at the end of an accounting period, such as on December 31, whereas the income statement summarized operations during a specified accounting period
True
The ending cash balance reported on the statement of cash flows is the same as the net sales amount reported on the firm’s income statement
False
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
True
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 2018
False
Net income is the profit earned (or the loss suffered) by a firm during an accounting period after the cost of goods sold and all expenses have been deducted from revenues
True
Accounting information is, first and foremost, management information
True
A person who wishes to practice accounting as a CPA must pass an exam prepared by the American Institute of Certified Public Accountants (AICPA)
True
According to the accounting equation, cash, inventory, equipment, and real estate are classified as owners’ equity
False
Dividing current assets by current liabilities gives the current ratio
True
Equipment and patents are known as intangible assets
False
The certified management accountant exam is designed to develop and measure not only accounting skills but also decision-making and critical-thinking skills
True
The form of financial statement used varies for different business, from a neighborhood video arcade to a giant conglomerate
False
Without the audit function and GAAP, there would be very little oversight or supervision of corporate accounting practices
True
A public accountant works on a fee basis for clients
True
Footnotes in accounting documents can offer red flags for investors and should he read and paid close attention to
True
The cost of goods sold equals beginning inventory plus net purchases minus ending inventory
True
A recent PricewaterhouseCoopers survey revealed that outsiders, primarily customers and intermediaries, are much more likely to be responsible for fraud committed against U.S. businesses
False
Often, the ones who are hurt when corporations cook the books are the firm’s employees, investors, lenders, and suppliers
True