A typical cash flow under operating activities includes cash flows from transactions in plant, property and equipment

True

False

Depreciation expense is subtracted from net income in a statement of cash flows

True

False

Predictive value, feedback value, and timeliness are ingredients needed to ensure that the information is reliable.

True

False

The balance sheet reports:

The financial condition of an accounting entity as of a particular date

The probable future benefits, probable future sacrifices, and residual interest for a period of time

The assets, expenses, and liabilities as of a certain date

The changes in assets, liabilities, and equity for a period of time

The assets, liabilities, gains, and losses for a period of time

There are many alternative titles for the statement of stockholders equity. The most frequently used alternative title is the statement of shareholders equity.

True

False

Gross profit is the difference between:

Gross sales and sales discounts

Net income and operating income

Revenues and expenses

Sales and cost of goods sold

Income from continuing operations and discontinued operations

Which of the following would be included in operating income?

interest Income for a manufacturing firm

Rent income for a leasing subsidiary

Gain from sale of marketable securities for a retailer

Dividend income for a service firm

If a firm consolidates subsidiaries that are not wholly owned, an income statement item is created that is termed:

Minority share of earnings

Dividend income

Equity income

Extraordinary

Gain from sale of subsidiary

At the end of the fiscal year, an adjusting entry is made that increases both interest expense and interest payable. This entry is an application for which accounting principle?

Full disclosure

Materiality

Matching

Going concern

Realization

In addition to the balance sheet, the income statement, and the statement of cash flows, a complete set of financial statements must include:

An auditor's opinion

A ten-year summary of operations

A note disclosure of such items as accounting policies

Historical common-size (percentage) summaries

A list of corporate officers