The failure of financial reports to provide information on customer satisfaction indexes, reject rates, and company sustainability efforts describes the financial reporting challenge of

12.   The failure of financial reports to provide information on customer satisfaction indexes, reject rates, and company sustainability efforts describes the financial reporting challenge of
a.       Forward-looking information.
b.      Nonfinancial measurements.
c.       Soft assets.
d.      Understandability.
 
13.   Fundamental considerations the FASB must keep in mind in its rule-making activities include
a.       Improvement in financial reporting.
b.      International convergence.
c.       Simplification of the accounting literature.
d.      All of these choices are correct.
 
14.   General-purpose financial statements are the product of
a.       managerial accounting.
b.      both financial and managerial accounting.
c.       neither financial nor managerial accounting.
d.      financial accounting.
 
15.   Which of the following is not a user of financial reports?
a.       Unions.
b.      Government agencies.
c.       Creditors.
d.      All of these are users.
 
16.   The financial statements most frequently provided include all of the following except the
a.       statement of cash flows.
b.      statement of retained earnings.
c.       income statement.
d.      balance sheet.
 
17.   The information provided by financial reporting pertains to
a.       an economy as a whole and to members of society as consumers, rather than to individual enterprises or industries.
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, rather than to industries or an economy as a whole or to members of society as consumers.
d.      individual business enterprises, industries, and an economy as a whole, rather than to members of society as consumers.
 
18.   All the following are differences between financial and managerial accounting in how accounting information is used except to
a.       plan and control company’s operations.
b.      decide whether to invest in the company.
c.       evaluate borrowing capacity to determine the extent of a loan to grant.
d.      all the above.
 
 
19.   Which of the following represents a form of communication through financial reporting but not through financial statements?
a.       President’s letter.
b.      Balance sheet.
c.       Income statement.
d.      Notes to financial statements.
 
20.   How does accounting help the capital allocation process attract investment capital?
a.       By providing timely, relevant information and by encouraging innovation.
b.      By promoting productivity.
c.       By providing timely, relevant information.
d.      By encouraging innovation.
 
21.   Which of the following helps in determining whether a business thrives?
a.       Markets.
b.      Competition.
c.       Free enterprise.
d.      All of these answer choices are correct.
22.   Which of the following is related to an effective capital allocation?
a.       Providing an efficient market for buying and selling securities.
b.      All of these answer choices are correct.
c.       Promoting productivity.
d.      Encouraging innovation.
 
23.   Financial statements in the early 2000s provide information related to
a.       nonfinancial measurements.
b.      none of these answer choices are correct.
c.       hard assets (inventory and plant assets).
d.      forward-looking data.
 
24.   Which of the following is not a major challenge facing the accounting profession?
a.       Timeliness.
b.      Accounting for hard assets.
c.       Forward-looking information.
d.      Nonfinancial measurements.
 
25.   What is the objective of financial reporting?
a.       Provide information about the reporting entity that is useful to present and potential equity investors, lenders, and other creditors.
b.      Provide information that excludes claims to the resources.
c.       Provide information that clearly portrays nonfinancial transactions.
d.      Provide information that is useful to management in making decisions.
 

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