REPASO CONTABILIDAD INTERMEDIA

The major elements of the income statement are

- Revenues, expenses, gains, and losses

Information in the income statement helps users to:

- Evaluate the past performance of the Enterprise.
- Provide a basis for the predicting future performance
- Help assess the risk or uncertainty of achieving future cash flows

Limitations of the income statement include:

- Items that cannot be measured reliably are not reported
- Income measurement involves judgment
- Income numbers are affected by the accounting methods
employed

Which of the following would represent the least likely t use of an

income statement prepared for the business enterprise?
- Use by the investors interested in the financial position of the
entity

Which of the following is an example of managing earnings up?

- Underestimating warranty claims

What might a manager do during the last quarter of a fiscal year if she
wanted to improve current annual net income?
- Relax credit policies for customers

What might a manager do during the last quarter of a fiscal year if she
wanted to decrease current annual income?
- Delay shipments to customers until after the end of the fiscal
year

Which of the following is an advantage of the single-step income

statement over the multiple-step income statement?
- It does not imply that one type of revenue or expense has
priority over another

The single-step income statement emphasizes

- Total revenues and total expenses

Which of the following is an acceptable method of presenting the

income statement?
- A single-step income statement
- A multiple-step income statement
- A consolidated statement of income

Which of the following is not generally practiced method of presenting

the income statement?
- Including prior period adjustments in determining net income

Which of the following is not a selling expense?

- Office salaries expense

In order to be classified as an extraordinary item in the income

statement, an event or transaction should be:
- Unusual in nature, infrequent, and material in amount

Which of these is a generally example of an extraordinary item?

- Gain resulting from the state exercising its right of eminent
domain on a piece of land used as a parking lot.

How should an unusual event not meet the criteria for an extraordinary
item be disclosed in the financial statement?
- Shown as a separate item in operating revenues or expenses if
material and supplemented by a footnote if deem appropriate.

Which of the following is a limitation to the balance sheet?

- Many items that are of financial value are omitted
- Judgments and estimates are used
- Current fair value is not reported

The balance sheet is useful for analyzing all of the following except?
- Profitability

Balance sheet information is useful for all of the following except?

- Analyze cash inflows and outflows for the period

Balance sheet information is useful far all of the following except?

- Determining free cash flows

A limitation of the balance sheet that is not also a limitation of the

income statement is

Valuation of the items at historical cost

The balance sheet contributes to financial reporting by providing a

basis for all of the following except?
- Determining the increase in cash due to operations

One criticism not normally aimed at the balance sheet prepared using
current accounting and report in standards is
- The extensive use of separate classifications

The amount of time that is expected to elapse until an asset is realized

or otherwise converted into cash is referred to as
- Liquidity

The net assets of a business are equal to

- None of these

The correct order to present current assets is:

- Cash, accounts receivable, inventories, prepaid items

Common stock Par value

Prepaid expenses
Natural resources original cost less accumulated depreciation
Property, plant, and equipment historical cost
Trade accounts receivable Net realizable value
Copyrights original cost less accumulated amortization
Merchandise inventory Lower of cost or market
Long-term bonds payable Amount payable when due, less
unamortized discount or pl
Land (in use) Unexpired or unconsumed cost
Land (future plant site) Unexpired or unconsumed cost
Patents Original cost less accumulated amortization
Trading securities Market value at balance sheet date
Trade accounts payable amount payable when due