QUESTION Which of the following is NOT one of the roles of the Government Accountability Office? A) examining matters relating to the receipt and payment of public funds B) confronting waste and abuse within public sectors C) ensuring correct billing practices for government welfare programs D) confronting fraud within public sectors E) performing specialized accounting […]
QUESTION The acid-test (or quick) ratio consists of current assets divided by current liabilities. Indicate whether the statement is true or false. ANSWER Answer: FALSE Explanation: The current ratio consists of current assets divided by current liabilities.
QUESTION As an accountant for a large nonprofit organization, Carter knows that one of his chief responsibilities is to provide financial transparency. What is meant by financial transparency? A) giving stakeholders an accurate picture of what is happening to their money B) determining whether an organization is staying within its budget C) evaluating a client’s […]
QUESTION The inventory turnover ratio can be used to measure a company’s efficiency. Indicate whether the statement is true or false. ANSWER Answer: TRUE Explanation: The inventory turnover ratio consists of costs of goods sold in one year divided by the average value of the inventory. If this figure is high, it indicates that […]
QUESTION Ratio analysis can be used to compare a company with other similar companies. Indicate whether the statement is true or false. ANSWER Answer: TRUE Explanation: Ratio analysis can be used to analyze a firm’s performance to its stated objectives and to compare it to similar firms.
QUESTION What is the most common use that the federal government makes of a firm’s accounting information? A) to evaluate the company’s financial health and credit rating B) to see whether the firm is profitable C) to ensure that appropriate tax revenues are collected D) to plan and guide the firm E) to monitor how […]
QUESTION What is the term given to the recording of a firm’s financial transactions? A) accounting B) bookkeeping C) auditing D) balancing E) forecasting ANSWER Answer: B Explanation: B) Bookkeeping is basically the recording of a firm’s financial transactions.
QUESTION One of the major types of financial statement is a liability report. Indicate whether the statement is true or false. ANSWER Answer: FALSE Explanation: Types of financial statements include balance sheets, income statements, and statements of cash flows.
QUESTION Assets may include unsold merchandise a company has on hand. Indicate whether the statement is true or false. ANSWER Answer: TRUE Explanation: Assets include cash on hand, accounts receivable, marketable securities, and merchandise inventory.
QUESTION The U. S. government’s fiscal year begins on July 1 and ends on June 30. Indicate whether the statement is true or false. ANSWER Answer: FALSE Explanation: The U.S. government’s fiscal year begins on October 1 and ends on September 30.
