General Accounting Principles MCQs

1. What factors affect the balance sheet, given the articulation of the income statement with the balance sheet and the factors that imply high or low quality of earnings?

2. What is the phrase which, though there is no agreement on its meaning, implies to most analysts that the  quality of earnings improves with the likelihood of recurrence?

3. What is the accounting objective which best relates to the double declining balance method?

4. What change was made by the Act regarding the authority competent to sign the company tax returns?

5. What is the phrase with no agreement on meaning which implies to most analysts that earnings quality increase with the likelihood of recurrence?

6. What is form 8-K?

7. Who can review the filings made by public companies with the SEC?

8. What change was made to the internal controls of the companies by the SOX?

9. What is the accounting objective which best relates to the LIFO method?

10. What is the acronym for the agency authorized by the U.S. Congress to regulate, among other things, the financial reporting practices of most public corporations?

11. What two filings are required when a company wishes to list its stock?

12. Which of the following accounts may appear on a company's balance sheet when the incomes for financial and tax reporting are different?

13. What are the 3 types of Health Care Organizations for accounting purposes?

14. What entry would a donor make when giving a cash donation to a charity, where the donor retains the right to revoke the contribution?

15. Which of the following is a valid criticism of the SOX?

16. When is revenue normally recognized for financial reporting on accrual basis?

17. What is the reporting objective that calls for the anticipation of all losses incurred but defers the recognition of gains or profits until they are realized in arm's length transactions?

18. Companies of what size have been impacted the most by the SOX from a cost perspective?

19. How are third party adjustments to patient bills reflected in the financial statements?

20. What is the accounting objective which best relates to the percentage of completion method?

21. What is the purpose of a Registration Statement?

22. What is the acronym for an organization that promotes the international harmonization of accounting standards?

23. What is the accounting objective which best relates to the FIFO method?

24. For which of the following would the use of the straight-line method of amortization be acceptable?

25. What is the acronym for the independent board responsible, since 1973, for establishing generally accepted accounting principles?

26. What is the database created by the SEC for companies to file electronically?

27. What is form 10-Q?

28. What is the accounting objective which best relates to the MACRS method?

29. What is the accounting objective which best relates to the Lower of Cost or Market Price method?

30. What is the accounting objective which best relates to the capitalization of prepaid advertising costs?

31. What new board was created as part of the Sarbanes Oxley Act?

32. What value should a contribution be accounted for at?

33. What is Form 10-K?

34. What statements are required of a Non-Profit organization?

35. Which of the following methods is normally considered to be acceptable for financial reporting?

36. What is the accounting objective which best relates to the disclosing of the cost of employee stock options (not expensing)?

37. What is the acronym for the organization that promotes international harmonization of accounting standards?

38. Which doctrine lays down that a firm should account for a given set of operations so as to make reported net income as large as possible?

39. What is the accounting objective which best relates to the straight line method?

40. What is the acronym for an independent board responsible, since 1973, for establishing generally accepted accounting principles?

41. What is the accounting objective which best relates to the percentage of sales method for uncollectible accounts?

42. What was the purpose of the Sarbanes Oxley act, in general?

43. What is the acronym for the agency authorized by the U.S. Congress to regulate the financial reporting practices of most public corporations?

44. Which of the following statements would be incorrect in comparing the financial statements of two companies, XYZ and ABC which are identical in all respects except that XYZ uses FIFO and ABC uses LIFO in costing its inventories? Prices have been rising steadily over the last several years.

45. What is the qualitative accounting objective suggesting that information reported in a financial statement should correspond as precisely as possible to the economic effects underlying transactions and events?

46. What is the effect of the SOX on public companies?

47. What is 'paying the least amount of taxes as late as possible within the law to minimize the present value of tax payments for a given set of operations' a description of?

48. How is a donated asset accounted by a non-profit organization based on its fair market value?

49. In which year was the Sarbanes Oxley Act passed?

50. How should a firm compensating its employees by granting them the option to purchase its shares report it?

51. Which of the following is a method of accounting for the exploration costs of a mineral resource that would best attain the objective of income tax accounting?

52. Which of the financial accounting objectives listed below would seem to be closest to the objective of tax reporting?

53. Which FASB sets the requirements for accounting for Non-Profit organizations?

54. How are gifts to a charity which are to be further passed on to a 3rd party accounted for while being held by the charity?

55. What is the accounting objective which best relates to the expensing of R&D costs?

56. How is an unconditional promise to give a donation to a charity accounted for by the charity?

57. What entry would a donor make when giving a cash donation to a charity?

58. What kind of organization issuing securities would NOT have to register them with the SEC?

59. For which of the following accounts would the use of 'the lower of cost or market price' principle be acceptable?

60. What is the accounting objective which best relates to the weighted average inventory method?

61. Which of the following is used by the FASB in the selection of acceptable accounting principles?

62. Which of the following is true of the Sarbanes Oxley Act?

63. Which of the following methods would be employed to help accomplish the following objective: smoothing a firm's income as a means of minimizing large fluctuations in the price of its stock.

64. What is the accounting objective which best relates to the expensing the cost of employee stock options?

65. What is the doctrine that the firm should account for a given set of operations so as to make reported net income as large as possible known as?

66. In which years were the Securities & Exchange Acts created?

67. What are forms 10K and 10Q referred to as?

68. Which of the following must generally be used for financial reporting if it is used for income tax reporting?

69. What is the accounting objective which best relates to the completed contract method?

70. Which of the following courses of action should a firm take in order to minimize the present value of income tax payments?

71. What change was made in regarding the penalization of the whistleblowers (people who alert the authorities about the illegal activities in a corporation) by the companies?

72. Which of the following is a method of timing business transactions or choosing accounting principles so that the firm reports smaller variations in income from year to year than it would otherwise?

73. Which sentence concerning ABC's financial statements would be correct? ABC Co. has decided to use the straight line depreciation method in its financial statements and the MACRS method in its tax return.