Acct 211 Fundamentals of Financial Accounting: Key Concepts and Principles

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Acct 211 Fundamentals of Financial Accounting: Key Concepts andPrinciplesAcct 211 Quiz 1 fall 2014Question1.The rule that requires financial statements to reflect the assumption that the business willcontinue operating instead of beingclosed or sold, unless evidence shows that it will notcontinue, is the:Going-concern assumption.Business entity assumption.Objectivity principle.Cost Principle.Monetary unit assumption.2.A partnership:Is also called a sole proprietorship.Has unlimited liability for its partners.Has to have a written agreement in order to be legal.Is a legal organization separate from its owners.Has owners called shareholders.3.The difference between a company's assets and its liabilities, or net assets is:Net income.Expense.Equity.Revenue.Net loss.

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4.Which of the following accounting principles prescribes that a company record its expensesincurred to generate the revenue reported?Going-concern assumption.Matching principle.Cost principle.Business entity assumption.Consideration assumption5.The primary objective of financial accounting is:To serve the decision-making needs of internal users.To provide financial statements to help external users analyze an organization's activities.To monitor and control company activities.To provide information on both the costs and benefits of looking after products and services.To know what, when, and how much to produce.6.All of the following are true regarding ethics except:Ethics are beliefs that separate right from wrong.Ethics rules are often set for CPAs.Ethics do not affect the operations or outcome of a company.Are critical in accounting.Ethics can be hard to apply.7.Social responsibility:Is a concern for the impact of ouractions on society.Is a code that helps in dealing with confidential information.Is required by the SEC.Requires that all businesses conduct social audits.

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Is limited to large companies.8.The accounting principle that requires accounting information to be based on actual cost andrequires assets and services to be recorded initially at the cash or cash-equivalent amount givenin exchange, is the:Accounting equation.Cost principle.Going-concern assumption.Realization principle.Business entityassumption9.All of the following regarding a Certified Public Accountant are true except:Must meet education and experience requirements.Must pass an examination.Must exhibit ethical character.May also be a Certified Management Accountant.Cannot hold any certificate other than a CPA.10.Decreases in equity that represent costs of assets or services used to earn revenues are called:Liabilities.Equity.Withdrawals.Expenses.Owner's Investment.11.The record in which transactions are first recorded is the:Account balance.Ledger.

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