Business

The debt to owners’ equity ratio measures the extent to which a compan

QUESTION The debt to owners’ equity ratio measures the extent to which a company uses debt to finance its operations. Indicate whether the statement is true or false.   ANSWER Answer: TRUE Explanation: The debt to owners’ ratio consists of total liabilities divided by owners’ equity. If it is high, it means liabilities are too […]

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Date: September 3rd, 2020

Which of the following occurred as a direct result of a specific high-

QUESTION Which of the following occurred as a direct result of a specific high-profile accounting scandal? A) the beginning of forensic accounting B) the beginning of independent audits C) the enactment of the Sarbanes-Oxley Act of 2002 D) the creation of the Government Accountability Office E) the rise of not-for-profit accounting   ANSWER Answer: C […]

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Date: September 3rd, 2020

Which of the following is NOT one of the roles of the Government Accou

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 […]

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Date: September 3rd, 2020

As an accountant for a large nonprofit organization, Carter knows that

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 […]

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Date: September 3rd, 2020

The inventory turnover ratio can be used to measure a company’s effici

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 […]

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Date: September 3rd, 2020

American accounting standards are becoming the basis for a global set

QUESTION American accounting standards are becoming the basis for a global set of standards. Indicate whether the statement is true or false.   ANSWER Answer: FALSE Explanation: The SEC now allows some large American companies to use the international accounting standards, established by the International Accounting Standards Board. The purpose of this and other moves […]

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Date: September 3rd, 2020

In double-entry bookkeeping, each entry is recorded as twice as much t

QUESTION In double-entry bookkeeping, each entry is recorded as twice as much the original amount. Indicate whether the statement is true or false.   ANSWER Answer: FALSE Explanation: With double-entry bookkeeping, the same entry is recorded twice but as both a credit and a debit. The total of all debits must equal the total of […]

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Date: September 3rd, 2020