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Unformatted text preview: ACC 2001 – Financial Reporting and Analysis 1 Spring 2011 Midterm Exam Multiple Choice (40 points) 1. Users of financial reports include all of the following except a. creditors. b. government agencies. c. unions. d. All of these are users. 2. The financial statements most frequently provided include all of the following except the a. balance sheet. b. income statement. c. statement of cash flows. d. statement of retained earnings. 3. The information provided by financial reporting pertains to a. individual business enterprises, rather than to industries or an economy as a whole or to members of society as consumers. b. business industries, rather than to individual enterprises or an economy as a whole or to members of society as consumers. c. individual business enterprises, industries, and an economy as a whole, rather than to members of society as consumers. d. an economy as a whole and to members of society as consumers, rather than to individual enterprises or industries. 4. How does accounting help the capital allocation process attract investment capital? a. Provides timely, relevant information. b. Encourages innovation. c. Promotes productivity. d. a and b above. 5. Whether a business is successful and thrives is determined by a. markets. b. free enterprise. c. competition. d. all of these. 6. An effective capital allocation process a. promotes productivity. b. encourages innovation. c. provides an efficient market for buying and selling securities. d. all of these. 7. Financial statements in the early 2000s provide information related to a. nonfinancial measurements. b. forward-looking data. c. hard assets (inventory and plant assets). d. none of these. 8. Which of the following is not a major challenge facing the accounting profession? a. Nonfinancial measurements. b. Timeliness. c. Accounting for hard assets. d. Forward-looking information. 9. A soundly developed conceptual framework of concepts and objectives should a. increase financial statement users' understanding of and confidence in financial reporting. b. enhance comparability among companies' financial statements. c. allow new and emerging practical problems to be more quickly solved. d. all of these. 10. In the conceptual framework for financial reporting, what provides "the why"--the goals and purposes of accounting? a. Measurement and recognition concepts such as assumptions, principles, and constraints b. Qualitative characteristics of accounting information c. Elements of financial statements d. Objectives of financial reporting 11. The underlying theme of the conceptual framework is a. decision usefulness. b. understandability. c. reliability. d. comparability. 12. Which of the following is not an objective of financial reporting?...
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This note was uploaded on 01/20/2012 for the course ACCOUNTING 101 taught by Professor Dubai during the Spring '11 term at Abu Dhabi University.
- Spring '11