Saranyas
Name____________________________________________________
Bus 220
Quiz Chapters 5 and 6
1. The primary responsibility for the information reported by a company rests with A) the Internal Revenue Service. B) the company's auditors. C) the local city council. D) the sales clerk supervisor. E) the company's management. Answer: E
2. The qualitative characteristic that says accounting information can influence users' decisions is A) comparability. B) materiality. C) reliability. D) relevance. E) None of the above is correct. Answer: D
3. In addition to the four required financial statements, which of the following is a required disclosure in the annual report of a publicly traded company? A) A five year summary of financial data. B) Notes (footnotes). C) Management's discussion and analysis. D) Only B and C are required disclosures. E) All of the above are required disclosures. Answer: E
4. Current liabilities are defined as A) obligations which are incurred during the past year. B) debts at the balance sheet date which must be paid within two years. C) accounts payable and bonds payable. D) debts at the balance sheet date which are expected to be paid with the current assets listed on the same balance sheet. E) obligations (debts) related only to normal operations. Answer: D
5. Polk Company suffered a loss from earthquake damage at its plant in Nebraska. The loss meets the criteria for an extraordinary item. Where will the company present the extraordinary item in the income statement? A) With other revenues and expenses. B) Following sales revenue, but before cost of goods sold. C) Following the section for discontinued operations, but before the section for the
Bus 220
Quiz Chapters 5 and 6
1. The primary responsibility for the information reported by a company rests with A) the Internal Revenue Service. B) the company's auditors. C) the local city council. D) the sales clerk supervisor. E) the company's management. Answer: E
2. The qualitative characteristic that says accounting information can influence users' decisions is A) comparability. B) materiality. C) reliability. D) relevance. E) None of the above is correct. Answer: D
3. In addition to the four required financial statements, which of the following is a required disclosure in the annual report of a publicly traded company? A) A five year summary of financial data. B) Notes (footnotes). C) Management's discussion and analysis. D) Only B and C are required disclosures. E) All of the above are required disclosures. Answer: E
4. Current liabilities are defined as A) obligations which are incurred during the past year. B) debts at the balance sheet date which must be paid within two years. C) accounts payable and bonds payable. D) debts at the balance sheet date which are expected to be paid with the current assets listed on the same balance sheet. E) obligations (debts) related only to normal operations. Answer: D
5. Polk Company suffered a loss from earthquake damage at its plant in Nebraska. The loss meets the criteria for an extraordinary item. Where will the company present the extraordinary item in the income statement? A) With other revenues and expenses. B) Following sales revenue, but before cost of goods sold. C) Following the section for discontinued operations, but before the section for the