QUESTION Briefly summarize the six steps of the accounting process. What will be an ideal response? ANSWER Answer: In the accounting process, an accountant finds and sorts records, puts daily transactions in journals, puts journal entries in categories in a ledger, tests the accuracy of the ledger by running a trial balance, reports on […]
QUESTION What is a forensic accountant? What will be an ideal response? ANSWER Answer: A forensic accountant investigates suspected crimes within the field of finance, such as fraud. They also investigate crimes against property, give expert testimony in court trials, and perform work related to civil disputes. Explanation: A forensic accountant investigates suspected crimes […]
QUESTION Why is it important that there are GAO accountants? What will be an ideal response? ANSWER Answer: GAO accountants serve to “police” our government spending. They find many ways to save billions of dollars collected from taxpayers and also work to stop mismanagement, fraud, and waste within all levels of government spending. Explanation: […]
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 […]
QUESTION Why do you think management by data will, ultimately, be a good thing for all corporations? What will be an ideal response? ANSWER Answer: Just as competition is good for a free market economy, so too is the new trend of management by data. As companies try to keep ahead of their rivals […]
QUESTION What is the accounting equation used to determine? A) whether ledgers are balanced B) tax liability C) a firm’s income D) what a firm is worth E) a firm’s profits ANSWER Answer: D Explanation: D) The accounting equation balances the company’s assets against its liabilities and owners’ equity, showing what the firm is […]
QUESTION Which of the following has to be accounted for to arrive at net sales figures for an income statement? A) refunds to customers B) owners’ equity C) cost of goods sold D) administrative expenses E) gross profit ANSWER Answer: A Explanation: A) After gross sales, the net sales must be adjusted by accounting […]
QUESTION What are assets? A) items of immediate value B) what a company owes C) the amount of investment plus earnings D) periodic reports of a firm’s worth E) notes payable ANSWER Answer: A Explanation: A) Assets are what a company has of value that are either cash or can be easily liquidated (converted […]
