Đề thi, bài tập trắc nghiệm online Kế toán tài chính – Đề 7

Footnotes to financial statements provide supplementary information that is essential for a proper understanding of the financial statements. They include details about accounting policies, contingent liabilities, significant events, and other disclosures not presented directly in the main body of the statements.

Goodwill is an intangible asset that arises when a company acquires another business for a purchase price that is higher than the fair value of its net identifiable assets (assets less liabilities). It represents the value of intangible factors such as brand reputation, customer relationships, etc.

Adjusting entries are made at the end of an accounting period to update certain account balances for accruals (revenues earned or expenses incurred but not yet recorded) and deferrals (revenues or expenses that have been deferred or postponed to a future period). They ensure that revenues and expenses are recognized in the correct period according to accrual accounting.

Closing entries are made at the end of an accounting period to transfer the balances of temporary accounts (revenues, expenses, and dividends) to a permanent equity account, Retained Earnings. This process prepares the temporary accounts for the next accounting period with zero balances.

The purpose of an audit is to provide an independent and objective opinion on whether a company′s financial statements are presented fairly, in all material respects, in accordance with applicable accounting standards. Auditors do not prepare financial statements or manage internal controls; their role is to provide assurance.

The Conservatism principle (or Prudence) dictates that when there is uncertainty, accountants should err on the side of caution. This means recognizing losses and expenses as soon as they are likely to occur, but delaying the recognition of gains and revenues until they are certain.

The Matching Principle dictates that expenses should be recognized in the same period as the revenues they help to generate. This ensures that the income statement accurately reflects the profitability for a given period by matching efforts (expenses) with results (revenues).

Net Income, calculated as Revenues minus Expenses, represents the profit or loss from operations. It increases owner′s equity (specifically retained earnings) and is a key indicator of a company′s profitability over a period.

Ethical considerations in financial accounting are primarily about honesty, integrity, and objectivity. Accurately and honestly reporting financial information, even if it presents a negative picture, is a key ethical responsibility. Choices between accounting methods (like FIFO or depreciation methods) are about accounting policy, and following standards (GAAP∕IFRS) is about compliance, not directly about ethics in the same way as honest reporting.

When inventory is purchased on credit, the 'Inventory′ (an asset) account increases, and 'Accounts Payable′ (a liability) account also increases. The accounting equation (Assets = Liabilities + Equity) remains balanced as both sides increase by the same amount.

Accounts Payable represents amounts owed to suppliers for goods or services purchased on credit, which is a liability. Inventory, Prepaid Rent, and Equipment are assets.

The direct method for the operating activities section of the Statement of Cash Flows reports the actual cash inflows and outflows from operating activities. The indirect method starts with net income and makes adjustments for non-cash items and changes in working capital accounts to arrive at cash flow from operations. They both result in the same net cash flow from operating activities, but differ in presentation.

Internal controls are processes implemented by a company′s board of directors, management, and other personnel designed to provide reasonable assurance about the achievement of objectives relating to operations, reporting, and compliance. They are crucial for safeguarding assets and ensuring reliable financial reporting.

Relevance is a fundamental qualitative characteristic, meaning that financial information must be capable of making a difference in the decisions made by users. Understandability, Verifiability and Timeliness are enhancing qualitative characteristics.

The primary objective of financial accounting is to provide useful financial information to external users such as investors, creditors, and regulators for making decisions about the reporting entity.

The Statement of Cash Flows typically categorizes cash flows into three main activities: Operating, Investing, and Financing. 'Sales Activities′ is not a standard category; sales are part of operating activities.

The Going Concern principle assumes that a business entity will continue to operate for the foreseeable future. This assumption underlies many accounting principles, such as depreciation and amortization, and justifies not valuing assets at liquidation values.

Double-entry bookkeeping is a system where every transaction affects at least two accounts. For each transaction, the total debits must equal the total credits, maintaining the balance of the accounting equation.

The Current Ratio (Current Assets ∕ Current Liabilities) is a liquidity ratio that measures a company′s ability to pay off its short-term liabilities with its short-term assets. A higher current ratio generally indicates better liquidity.

The basic accounting equation is Assets = Liabilities + Equity. It represents the foundation of the balance sheet and double-entry bookkeeping, showing that a company′s assets are financed by either liabilities or equity.

Accounts Receivable is a current asset because it is expected to be converted to cash or used up within one year or the operating cycle, whichever is longer. Land, Equipment, and Buildings are typically classified as long-term assets or Property, Plant, and Equipment (PP&E).

The Income Statement (or Profit and Loss Statement) reports a company′s revenues and expenses over a specific period, resulting in net income or net loss, which reflects financial performance.

Inventory refers to goods that are held for sale in the ordinary course of business. It is a current asset for merchandising and manufacturing companies. Equipment is a long-term asset, money owed by customers is accounts receivable, and supplies are usually a separate category of current assets.

The Statement of Cash Flows tracks all cash inflows (cash coming into the company) and cash outflows (cash leaving the company) during a specific period, categorized into operating, investing, and financing activities.

Depreciation is an accounting method used to allocate the cost of a tangible or physical asset over its useful life. It represents the reduction in the value of an asset over time due to wear and tear, obsolescence, or usage.

Issuing bonds payable means the company receives cash (an increase in assets) and incurs a debt obligation (an increase in liabilities). Thus, both assets and liabilities increase, maintaining the balance of the accounting equation.

International Financial Reporting Standards (IFRS) are a set of accounting standards developed by the International Accounting Standards Board (IASB) and are used by most countries around the world. GAAP is primarily used in the United States.

Dividends are a distribution of profits to shareholders, reducing retained earnings, rather than a component of owner′s equity itself. Retained Earnings, Common Stock, and Accumulated Other Comprehensive Income are all components of owner′s equity.

The Revenue Recognition principle requires that revenue should be recognized when it is earned and realizable or realized, regardless of when the cash is received. This is usually when goods are delivered or services are rendered, and there is reasonable assurance of collection.

Recording revenue too early (premature revenue recognition) will overstate revenue and thus overstate net income in the current period. In future periods, when the revenue should have been correctly recognized, it might be understated, leading to a potential understatement of net income in those periods.