Accounting for Managers

1. Sole proprietorships and partnerships are taxable entities.

True

x False

Score: 0 of 1

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2. Internal users of accounting information include a company's investors (or stockholders).

True

x False

Score: 1 of 1

________________________________________

3. Interest expense would be classified under operating activities.

x True

False

Score: 1 of 1

________________________________________

4. The balance sheet reports assets and claims to those assets at a specific point in time.

x True

False

Score: 1 of 1

________________________________________

5. The notes to the financial statements are not required.

True

x False

Score: 1 of 1

________________________________________

6. The Statement of Cash Flows reports only cash flows from operations.

True

x False

Score: 1 of 1

________________________________________

7. Only Certified Public Accountants may perform audits.

x True

False

Score: 1 of 1

________________________________________

8. Easy transfer of ownership is a characteristic of which form of business organization?

Sole proprietorship

Partnership

Corporation

All of the above

Score: 1 of 1

________________________________________

9. In which forms of business organization are the owners personally liable for all the debts of the business?

Sole proprietorship and corporation

Sole proprietorship and partnerships

Partnership and corporation

All of them

Score: 1 of 1

________________________________________

10. Internal users want answers to which of the following questions?

What price for our product will maximize the company's net income?

Which product line is most profitable?

Is cash sufficient to pay dividends to stockholders?

All of the above.

Score: 1 of 1

________________________________________

11. Which of the following is not an external user of accounting data?

Customers

Economic planners

Finance directors

Labor unions

Score: 1 of 1

________________________________________

12. Paying interest expense and receiving interest revenue are examples of:

Operating activities

Delivery activities

Financing activities

Investing activities

Score: 1 of 1

________________________________________

13. The payment of dividends is an example of a(n):

Investing activity

Financing activity

Operating activity