AccountingBLOCK

These multiple choice questions are from a quiz that I recently gave in class. I haven't received the results back yet but I have bolded my answers.

1) Secondary qualitative characteristics of accounting information include:

A) Relevance and comparability
B) Comparability and consistency
C) Reliability and relevance
D) Reliability and consistency

2) Which of the following best demonstrates the full disclosure principle:

A) The company's Tax return
B) The multi-step income statement
C) Disclosure notes to financial statements
D) The auditor's report

3) If an independant auditing firm expresses dissatisfaction with a company's financial statement, it issues:

A) A disqualified opinion
B) An unqualified opinion
C) No Opinion
D) A qualified opinion

4) A firm's comprehensive income is always:

A) Greater than the net income
B) Less than the net income
C) Same as the net income
D) None of the above

5) Cash flows from investing activities do not include:

A) Proceeds from issuing bonds
B) Collections of loans made to others
C) Payment for the purchase of equipment
D) Proceeds from the sale of marketable securities.

__________________
Longster - NoNo

You have two questions wrong there:

3) D (it is a trick question)
4) D

Shareholders' Equity, beg. of period
- Dividends
+ Premium to book value received from new shares (and vice versa)
+ Comprehensive Earnings (and vice versa)
------------------------------------------
= Shareholders' Equity, end of period (comprehensive income)

__________________
Owner Zindah, Inc.
A.A Accounting
B.S Accounting

The third question doesn't follow the english dictionary, it follows the accounting one. It is strange what accountants have done lol

Glad now I know!