Chapter Twelve: Corporations & Their Financial Statements
This quiz covers key aspects of corporate financial statements, including earnings, cash flows, and consolidated reports, crucial for understanding corporate financial health.
Questions and Answers
- 1.
LOS Question:Describe the structure of the earnings statement and explain the sources of net income(or net earnings).
- 2.
LOS Question:Describe the components of the cash flow statement and classify an accounting activity oritem as a cash flow from operating, financing or investing activities.
- 3.
LOS Question:Explain the importance of the notes to the financial statements and the auditor’s report.
- 4.
I’VE SEEN VARIOUS FORMS OF THE BASIC ACCOUNTING EQUATION. WHICHEQUATION IS CORRECT?
- 5.
HOW DOES A BALANCE SHEET BALANCE WHEN A COMPANY FIRST STARTSOUT?
- 6.
WHAT DOES “CONSOLIDATED” MEAN WHEN WE ARE TALKING ABOUTCONSOLIDATED FINANCIAL STATEMENTS?
- 7.
WHAT ARE THE JOURNAL ENTRIES FOR DIVIDENDS DECLARED AND FOR NEWBOND ISSUES?
- 8.
HOW DOES A COMPANY ESTABLISH THE VALUE OF GOODWILL?
- 9.
CAN YOU PLEASE GIVE ME AN EXAMPLE OF AN INTANGIBLE ASSET WITH AFINITE LIFE
- 10.
CAN A COMPANY WRITE OFF GOODWILL?
- 11.
WHAT IS THE NET ASSET VALUE OF A COMPANY? IS IT RELATED TO BOOKVALUE?
- 12.
HOW COME ISSUED SHARES ARE NOT MENTIONED ON THE BALANCE SHEET?
- 13.
CAN YOU PLEASE EXPLAIN THE DIFFERENCE BETWEEN FIFO AND LIFO WITHAN EXAMPLE?
- 14.
CAN YOU PLEASE EXPLAIN HOW CAPITALIZING A LEASE WORKS?
- 15.
WHAT IS THE PURPOSE OF CAPITALIZING ITEMS ON THE BALANCE SHEET?
- 16.
HOW IS THE DECISION REACHED TO CAPITALIZE AN ITEM ON THE BALANCESHEET?
- 17.
DOES ACCUMULATED APPRECIATION ON THE BALANCE SHEET MEAN THATTHE COMPANY HAS EXTRA CASH AVAILABLE?
- 18.
CAN YOU DISTINGUISH BETWEEN AMORTIZATION, DEPRECIATION ANDDEPLETION? THEY ALL SEEM TO BE THE SAME THING.
- 19.
WHAT IS A SINKING FUND?
- 20.
COULD YOU PLEASE EXPLAIN WHY ACCOUNTING PRINCIPLES WOULD DIFFERFROM GOVERNMENT TAXATION PRINCIPLES?
- 21.
CAN YOU EXPLAIN WHY FUTURE TAXES WOULD SOMETIMES BE RECORDEDAS AN ASSET AND SOMETIMES AS A LIABILITY?
- 22.
HOW COME THE TAXES A COMPANY HAS TO PAY TO THE GOVERNMENT MAYNOT BE THE SAME AS THEY SHOW ON THEIR FINANCIAL STATEMENTS?
- 23.
WHAT SHOULD I REMEMBER REGARDING PERMANENT AND TEMPORARYDIFFERENCES BETWEEN TAX PROVISIONS AND ACTUAL TAX PAYABLE?
- 24.
CAN YOU EXPLAIN WHAT HAPPENS ON THE FINANCIAL STATEMENTS WHEN ABOND IS SOLD AT A PRICE HIGHER THAN PAR?
- 25.
WHAT ARE THE COSTS ASSOCIATED WITH ISSUING A BOND?
- 26.
WHAT IS A FOREIGN CURRENCY TRANSLATION?
- 27.
WHAT IS AN IMPAIRMENT LOSS?
- 28.
WHAT DOES CASH SURRENDER VALUE REFER TO?
- 29.
HOW IS THE COST METHOD OF ACCOUNTING REFLECTED ON THE EARNINGSSTATEMENT?
- 30.
CAN YOU DESCRIBE THE DIFFERENCE BETWEEN A SUBSIDIARY AND ANAFFILIATED COMPANY?
- 31.
HOW IS BALANCE SHEET AFFECTED AFTER THE COMPANY DECLARESSTOCK DIVIDEND?
- 32.
CAN YOU EXPLAIN THE AMORTIZATION OF BOND PREMIUMS WHEN BONDSARE SOLD FOR HIGHER THAN PAR?
- 33.
HOW WOULD DEFERRED CHARGES CHANGE OVER TIME ON THE BALANCESHEET:?
- 34.
WHAT DOES “RECEIVERSHIP” REFER TO?
- 35.
HOW IS A GAIN OR LOSS ON THE EARNINGS STATEMENT RECORDED ON THEBALANCE SHEET?
- 36.
WHY WOULD DIVIDENDS NOT BE RECORDED ON THE EARNINGS STATEMENTTHAT WERE PAID FROM AN AFFILIATED COMPANY?
- 37.
CAN YOU EXPLAIN HOW ALL THE TAX ENTRIES OF THE VARIOUS TEXTBOOKSAMPLE FINANCIAL STATEMENTS ARE RELATED?
- 38.
HOW WOULD REVENUE, WHICH AFFECTS THE EARNINGS STATEMENT,ULTIMATELY BE RECORDED ON THE BALANCE SHEET?
- 39.
CAN YOU PLEASE EXPLAIN WHERE MINORITY INTEREST COMES FROM ONTHE EARNINGS STATEMENT?
- 40.
CAN YOU SUMMARIZE THE DIFFERENCES BETWEEN THE CONSOLIDATEDMETHOD, EQUITY METHOD AND COST METHOD OF ACCOUNTING?
- 41.
IF THE FINANCIAL STATEMENTS WERE CONSOLIDATED, WOULD WE STILLSEE ENTRIES FOR EQUITY AND COST METHODS OF ACCOUNTING ON THESAME STATEMENTS?
- 42.
WHERE ON THE SAMPLE FINANCIAL STATEMENTS CAN I SEE EXAMPLES OFTHE CONSOLIDATED, EQUITY INCOME AND COST METHODS OFACCOUNTING?
- 43.
WHAT IS THE DEFINITION OF A QUASI-LIABILITY?
- 44.
WHERE IN THE FINANCIAL STATEMENTS WOULD WE SEE THE EARNINGSFROM THE SUBSIDIARY COMPANY?
- 45.
WHY ISN’T A DIVIDEND PAID TO A COMPANY THAT CLAIMS EQUITY INCOMERECORDED ON THE EARNINGS STATEMENT?
- 46.
WHAT IMPACT DO NON-CASH ITEMS HAVE ON THE FINANCIAL STATEMENTTHAT DIFFER FROM THEIR IMPACT ON RATIO CALCULATIONS?
- 47.
WHAT IS THE DIFFERENCE BETWEEN MINORITY INTEREST ON THE BALANCESHEET VERSUS MINORITY INTEREST ON THE EARNINGS STATEMENT?
- 48.
WHY DO WE ADD BACK SOME NON-CASH ITEMS WHEN CALCULATINGRATIOS?
- 49.
CAN YOU PLEASE DESCRIBE THE DIFFERENCE BETWEEN THE DIRECT ANDINDIRECT CASH FLOW METHODS?
- 50.
CAN YOU PLEASE EXPLAIN ITEM 50 ON THE SAMPLE CASH FLOWSTATEMENT?
Quiz Review Timeline +
Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.
-
Current Version
-
Mar 22, 2023Quiz Edited by
ProProfs Editorial Team -
Jan 22, 2009Quiz Created by
Smzachary
Test Your Basic Forex Trading Skills With This Quiz
Test Your Basic Forex Trading Skills With This Quiz
Control Your Finances: Do I Need a Financial Advisor? Quiz
Control Your Finances: Do I Need a Financial Advisor? Quiz
Back to top