Intermediate Accounting Volume 1, 11th Canadian Edition By Bruce J. McConomy Donald E. Kieso-Test Bank

Test Bank: Intermediate Accounting Volume 1, 11th Canadian Edition By Bruce J. McConomy Donald E. Kieso

ISBN-10:1119048532 , ISBN-13:978-1119048534

CHAPTER 1: The Environment of Financial Reporting in Canada

1. The primary characteristic(s) of accounting is (are)
a) transmission of financial data to concerned internal parties only.
b) transmission of economic data to external parties.
c) recognition and quantification of financial data only.
d) recognition, quantification, and transmission of financial data.

Answer: d

Level of Difficulty: Simple
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of limited resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
Bloomcode: Knowledge

2. Financial accounting involves the process that leads to
a) the formulation of financial statements.
b) specialized reports for overseeing and managing inventory.
c) specialized reports for calculating and acknowledging income tax.
d) reports on fluctuations in stock prices and future forecasts of market position.

Answer: a

Level of Difficulty: Simple
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of limited resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
Bloomcode: Knowledge

3. Financial accounting can be broadly defined as the domain of accounting that prepares financial statements to be utilized
a) exclusively by internal parties of the business entity.
b) by investors exclusively.
c) by both internal and external parties of the business entity.
d) mainly by external users and the Canada Revenue Agency.

Answer: c

Level of Difficulty: Moderate
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
Bloomcode: Knowledge

4. Management accounting can be broadly defined as the domain of accounting that conveys financial data
a) solely to investors.
b) solely to internal parties of the business entity.
c) to both internal and external parties of the business entity.
d) mainly to external users and the Canada Revenue Agency.

Answer: b

Level of Difficulty: Simple
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
CPA: Management Accounting
Bloomcode: Knowledge

5. The prosperity and viability of a business are determined by
a) free competition or enterprise.
b) solely competition and markets.
c) markets and competition exclusively.
d) markets, competition, and free enterprise.

Answer: d

Level of Difficulty: Moderate
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
CPA: Strategy & Governance
Bloomcode: Knowledge

6. Which of the following is precise?
a) Reported accounting figures do not influence the transfer of resources.
b) Credit rating agencies utilize accounting data to evaluate their assets.
c) Efficient capital markets boost productivity and foster innovation.
d) Efficient capital markets boost productivity but do not foster innovation.

Answer: c

Level of Difficulty: Moderate
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
CPA: Strategy & Governance
Bloomcode: Knowledge

7. Information supplied by accounting is crucial as it enables investors and creditors to
a) compare revenues and assets of corporations.
b) evaluate the relative risks and returns of investment opportunities.
c) manage their resources more efficiently.
d) all of the above

Answer: d

Level of Difficulty: Simple
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
CPA: Strategy & Governance
Bloomcode: Knowledge

8. In Canada, the main mechanisms for resource allocation are
a) debt & equity markets.
b) financial institutions such as banks.
c) government entities like the Canada Revenue Agency (CRA).
d) both a & b

Answer: d

Level of Difficulty: Moderate
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
CPA: Financial Reporting
Bloomcode: Knowledge

9. Which of the following are significant factors in the swiftly evolving financial reporting landscape in Canada?
a) heightened demand for accountants and the influence of technology
b) globalization and the unethical conduct of accountants
c) the increasing number of institutional investors seeking more data on environmental and social issues
d) escalated utilization of the Internet

Answer: c

Level of Difficulty: Simple
Goal of Learning: Elaborate on how accounting facilitates the efficient utilization of scarce resources.
Section Reference: Accounting and Allocation of Capital
Goal of Learning: Discuss some of the obstacles and possibilities for accounting.
Section Reference: Challenges and Opportunities for the Accounting Profession
CPA: Financial Reporting
Bloomcode: Knowledge

10. Stakeholders who aid in the effective allocation of resources comprise
a) investors and creditors.
b) financial analysts and regulators.
c) creditors and auditors.
d) management and auditors.

Answer: b

Level of Difficulty: Simple
Goal of Learning: Elaborate on the meaning of “stakeholder” and identify crucial stakeholders in financial reporting, explaining what is at risk for each one.
Section Reference: Stakeholders
CPA: Financial Reporting
Bloomcode: Knowledge

Accounting Related Test Banks

Test Bank For Accounting for Decision Making and Control 9th Edition By Zimmerman

Solution Manual For Accounting for Decision Making and Control for the 9th Edition