Question

1. The FASB takes on a responsibility to do the following, except:

Multiple Choice

• Set the objectives of financial reporting.

• Describe the elements of financial statements.

• Judge disputes between management and the CPA.

• Determine the criteria for deciding what information to include in financial statements.

2. Which of the following is not a step in the accounting cycle?

Multiple Choice

• Prepare financial statements.

• Prepare an adjusted trial balance.

• Prepare a trial balance.

• Prepare a purchase order.

3. Which of the following is not true regarding the general ledger account for Cash?

Multiple Choice

• The balance of the account indicates the amount of cash owned by the business on a particular date.

• Each debit entry in the Cash account represents a cash receipt.

• Credit entries in the Cash account represent cash payments.

• Debit entries are made before credit entries.

4. The accounting cycle begins with:

Multiple Choice

• Posting of journal entries to ledger accounts.

• Preparation of a trial balance.

• Initial recording of business transactions.

• Formation of a business.

Answer 1

1. Option (c) is correct

FASB does not jusdge disputes between management and CPA

2. Option (d) is correct

Preparing a purchase order is not a step in accounting cycle.

3. Option (d) is correct

4. Option (c) is correct

The accounting cycle begins with initial recording of business transactions.