QUESTION Which of the following does Michaels assume? A) Revenues this year were not as high as last year’s. B) Revenues are not as high as Kershner thinks they are. C) Selling expenses exceeded administrative expenses this year. D) Other factors must be taken into account to arrive at an income statement. E) Income taxes […]
QUESTION Which of the following, if true, supports the mother’s position? A) Julie has said that she wants to work for one of the Big Four accounting and professional services firms. B) The demand for government accountants is expected to grow in the near future. C) Two other recent grads in Julie’s class chose to […]
QUESTION Santos has a high level of current liabilities compared to its cash on hand. One company executive predicts that this means that Santos will not have a good acid-test ratio. Which of the following points out a flaw in his argument? A) Current liabilities are not relevant to the acid-test ratio. B) The company […]
QUESTION Which of the following, if true, supports the position that Julie should consider a specialty field in accounting? A) Julie wants to eventually pursue an MBA degree. B) Colleges have different policies on whether specialty accounting courses are required. C) Julie is interested in financial crimes. D) Julie is interested in helping a nonprofit […]
QUESTION Which of the following, if true, supports the father’s position? A) Julie has said she wants to work for one of the Big Four accounting and professional services firms. B) The demand for external auditors is expected to grow in the near future. C) Many accountants flooded the job market when the Arthur Andersen […]
QUESTION Which of the following, if true, does NOT strengthen the case that Aardvark needs to hire a full-time financial manager? A) The company needs its cash flow to be continuously monitored. B) The company needs to determine how to market its products so as to reach the largest number of customers. C) The company […]
QUESTION Which of the following, if true, strengthens the case that Streeter & Sons is profitable? A) The company’s sales revenue is low relative to its cost of goods sold. B) The company’s cost of goods sold is low relative to its sales revenue. C) The company has had the same number of customers for […]
QUESTION What is the difference between tax accounting and managerial advisory services? What will be an ideal response? ANSWER Answer: In tax accounting, the CPA concentrates on preparing tax returns and doing tax planning; however, when he or she provides management advisory services, specialized accounting services are provided to help business managers resolve various […]
QUESTION What is the significance of the SEC’s move toward accommodating International Financial Reporting Standards? What will be an ideal response? ANSWER Answer: By moving toward this international accounting standard, the SEC is moving the United States and, in fact, the world toward one set of international standards, which will make it easier for […]
QUESTION Why is double-entry bookkeeping important? What will be an ideal response? ANSWER Answer: With double-entry bookkeeping, each transaction is recorded as both a credit and a debit, making it less likely that there will be errors because both accounts must be reconciled with each other. Explanation: With double-entry bookkeeping, each transaction is recorded […]
