ACC 561 Week 6 Final Exam / University of Phoenix / (30/30) - 69119

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Question 1

 

Which of the following is an advantage of corporations relative to partnerships and sole proprietorships?

 

·         Lower taxes

 

·         Most common form of organization

 

·         Reduced legal liability for investors

 

·         Harder to transfer ownership

 

Question 2

 

The group of users of accounting information charged with achieving the goals of the business is its

 

·         Managers

 

·         Creditors

 

·         Auditors

 

·         investors

 

Question 3

 

Which of the following financial statements is concerned with the company at a point in time?

 

·         Income statement.

 

·         Retained Earnings statement

 

·         Balance sheet

 

·         Statement of cash flows

 

Question 4

 

An income statement

 

·         presents the revenues and expenses for a specific period of time

 

·         summarizes the changes in retained earnings for a specific period of time

 

·         reports the changes in assets, liabilities, and stockholders’ equity over a period of time

 

·         reports the assets, liabilities, and stockholders’ equity at a specific date

 

Question 5 

 

The most important information needed to determine if companies can pay their current obligations is the

 

·         relationship between short-term and long-term liabilities

 

·         net income for this year

 

·         relationship between current assets and current liabilities

 

·         projected net income for next year

 

Question 6

 

A liquidity ratio measures the

 

·         ability of a company to survive over a long period of time

 

·         short-term ability of a company to pay its maturing obligations and to meet unexpected needs for cash

 

·         percentage of total financing provided by creditors

 

·         income or operating success of a company over a period of time

 

Question 7

 

The convention of consistency refers to consistent use of accounting principles

 

·         among accounting periods

 

·         among firms

 

·         within industries

 

·         throughout the accounting periods

 

 

 

Question 8

 

Horizontal analysis is also known as

 

·         linear analysis

 

·         vertical analysis

 

·         trend analysis

 

·         common size analysis

 

 

 

Question 9

 

Horizontal analysis is a technique for evaluating a series of financial statement data over a period of time

 

·         to determine which items are in error

 

·         to determine the amount and/or percentage increase or decrease that has taken place

 

·         that has been arranged from the highest number to the lowest number

 

·         that has been arranged from the lowest number to the highest number

 

 

 

 

 

Question 10 

 

 

 

 

 

Vertical analysis is a technique that expresses each item in a financial statement

 

·         in dollars and cents

 

·         starting with the highest value down to the lowest value

 

·         as a percent of the item in the previous year

 

·         as a percent of a base amount

 

 

Solution Description

ACC 561

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Week 6 Final Exam Questions with answers.docx
Week 6 Final Ex...