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TEST BANK For Fundamental Accounting Principles , 24th Edition By Wild || Verified All Chapters ( 1-26)| Newest Version 2024 A+ $12.49   Add to cart

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TEST BANK For Fundamental Accounting Principles , 24th Edition By Wild || Verified All Chapters ( 1-26)| Newest Version 2024 A+

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TEST BANK For Fundamental Accounting Principles , 24th Edition By Wild || Verified All Chapters ( 1-26)| Newest Version 2024 A+ TEST BANK For Fundamental Accounting Principles , 24th Edition By Wild || Verified All Chapters ( 1-26)| Newest Version 2024 A+ Fundamental Accounting Principles, 24e (W...

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  • June 28, 2024
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Fundamental Accounting Principles, 24e (Wild)
Chapter 1 Accounting in Business

1) Accounting is an information and measurement system that identifies, records, and
communicates an organization's business activities.

Answer: TRUE
Difficulty: 1 Easy
Topic: Importance of Accounting
Learning Objective: 01-C1 Explain the purpose and importance of accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making

2) Recordkeeping, or bookkeeping, is the recording of transactions and events, either manually
or electronically. This is just one part of accounting.

Answer: TRUE
Difficulty: 1 Easy
Topic: Importance of Accounting
Learning Objective: 01-C1 Explain the purpose and importance of accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making

3) An accounting system captures relevant data about transactions and then classifies, records,
and reports data.

Answer: TRUE
Difficulty: 1 Easy
Topic: Importance of Accounting
Learning Objective: 01-C1 Explain the purpose and importance of accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making

4) Financial accounting is the area of accounting aimed at serving external users by providing
them with general-purpose financial statements.

Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making
1
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.

,5) Internal users of accounting information do not directly run the organization and have limited
access to its accounting information.

Answer: FALSE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making

6) Auditors verify the effectiveness of internal controls.

Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making

7) External auditors examine financial statements to verify that they are prepared according to
generally accepted accounting principles.

Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making

8) External users include lenders, shareholders, customers, and regulators.

Answer: TRUE
Difficulty: 2 Medium
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Critical Thinking; FN Decision Making




2
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.

,9) Regulators often have legal authority over certain activities of organizations.

Answer: TRUE
Difficulty: 1 Easy
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Decision Making

10) Internal users include lenders, shareholders, brokers and nonexecutive employees.

Answer: FALSE
Difficulty: 2 Medium
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Decision Making

11) Opportunities in accounting include auditing, consulting, market research, and tax planning.

Answer: TRUE
Difficulty: 2 Medium
Topic: Users of Accounting Information
Learning Objective: 01-C2 Identify users and uses of, and opportunities in, accounting.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Decision Making

12) Ethics is defined as maximizing personal wealth, regardless the cost.

Answer: FALSE
Difficulty: 2 Medium
Topic: Ethics
Learning Objective: 01-C3 Explain why ethics are crucial to accounting.
Bloom's: Understand
AACSB/Accessibility: Ethics / Keyboard Navigation
AICPA: BB Industry; FN Decision Making




3
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.

, 13) The Sarbanes-Oxley Act (SOX) requires documentation and verification of internal controls.
It also emphasizes effective internal controls.

Answer: TRUE
Difficulty: 1 Easy
Topic: Ethics
Learning Objective: 01-C3 Explain why ethics are crucial to accounting.
Bloom's: Remember
AACSB/Accessibility: Ethics / Keyboard Navigation
AICPA: BB Legal; FN Reporting

14) The fraud triangle asserts that the three factors that must exist for a person to commit fraud
are opportunity, pressure, and rationalization.

Answer: TRUE
Difficulty: 2 Medium
Topic: Ethics
Learning Objective: 01-C3 Explain why ethics are crucial to accounting.
Bloom's: Understand
AACSB/Accessibility: Ethics / Keyboard Navigation
AICPA: BB Industry; BB Legal; FN Decision Making

15) Management is not responsible for implementing internal controls and does not need to issue
a report on internal controls.

Answer: FALSE
Difficulty: 2 Medium
Topic: Generally Accepted Accounting Principles
Learning Objective: 01-C4 Explain generally accepted accounting principles and define and
apply several accounting principles.
Bloom's: Understand
AACSB/Accessibility: Ethics / Keyboard Navigation
AICPA: BB Legal; FN Reporting

16) A partnership is a business owned by two or more people.

Answer: TRUE
Difficulty: 1 Easy
Topic: Generally Accepted Accounting Principles
Learning Objective: 01-C4 Explain generally accepted accounting principles and define and
apply several accounting principles.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Decision Making



4
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.

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