Question 1

An inventory loss from a market decline occurred in the first quarter that was not expected to be restored in the fiscal year.For interim financial reporting purposes,how would the dollar amount of inventory in the balance sheet be affected in the first and fourth quarters? First Quarter Fourth Quarter

Accepted Answer

A)  Decrease No effect
B)  Decrease Increase
C)  No effect Decrease
D)  No effect No effect

Question 2

A major impact of the Foreign Corrupt Practices Act of 1977 is that registrants subject to the Securities Exchange Act of 1934 are now required to

Accepted Answer

A)  Keep records which reflect the transactions and dispositions of assets and maintain a system of internal accounting controls
B)  Provide access to records by authorized agencies of the federal government
C)  Records all correspondence with foreign nations
D)  Prepare financial statements in accordance with international accounting standards
E)  Produce full,fair,and accurate periodic reports on foreign commerce and/or foreign political party affiliations

Question 3

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example supplementary information that should be disclosed because it affects an area that is directly affected by existing FASB Standards

Accepted Answer

A)  Management discussion and analysis.
B)  Segment information.
C)  Accounting policies.
D)  A statement of cash flows.

Question 4

Footnotes to a company's financial statements are used to

Accepted Answer

A)  More fully explain certain items in the financial statements.
B)  Reflect financial notes personalized by the company's executive team.
C)  Show the detail of salaries of every employee.
D)  Justify fraudulent business practices.

Question 5

List and explain the three types of financial analysts.

Accepted Answer

Professional security analysts make inve...

Question 6

Under the Securities Act of 1933,subject to some exceptions and limitations,it is unlawful to use the mails or instruments of interstate commerce to sell or offer to sell a security to the public unless

Accepted Answer

A)  A surety bond sufficient to cover potential liability to investors is obtained and filed with the Securities and Exchange Commission
B)  The offer is made through underwriters qualified to offer the securities on a nationwide basis
C)  A registration statement has been properly filed with the Securities and Exchange Commission,has been found to be acceptable,and is in effect
D)  The Securities and Exchange Commission approves of the financial merit of the offering C

Question 7

Which SEC reporting form is the normal registration statement for securities to be sold to the public?

Accepted Answer

A)  Form 10.
B)  Form 10-K.
C)  Form 10-Q.
D)  Proxy Statement.

Question 8

What information is required to be included in the MD & A section of the 10-K annual report.Do not include the information required by item 7a).

Accepted Answer

Basically,the MD&A section evaluates the...

Question 9

Footnotes to financial statements should not be used to

Accepted Answer

A)  Describe the nature and effect of a change in accounting principles
B)  Identify substantial differences between book and tax income
C)  Correct an improper financial statement presentation
D)  Indicate bases for valuing assets

Question 10

The inclusion of MD&A Management Discussion and Analysis) in annual reports is required by the

Accepted Answer

A)  FASB.
B)  AICPA.
C)  SEC.
D)  APB. C

Question 11

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example supplementary information that should be disclosed because it affects an area that is directly affected by existing FASB Standards

Accepted Answer

A)  Management discussion and analysis.
B)  Segment information.
C)  Accounting policies.
D)  A statement of cash flows.

Question 12

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example information that should be disclosed in the notes to financial statements because it is basic to the financial statements

Accepted Answer

A)  Management discussion and analysis.
B)  Accounting policies.
C)  Segment information.
D)  The auditor's report. B

Question 13

The Securities and Exchange Commission SEC) was established in1934 to help regulate the U.S.securities market.Which of the following statements is true concerning the SEC?

Accepted Answer

A)  The SEC prohibits the sale of speculative securities.
B)  The SEC regulates only securities offered for public sale.
C)  Registration with the SEC guarantees the accuracy of the registrant's prospectus.
D)  The SEC's initial influence and authority has diminished in recent years as the stock exchanges have become more organized and better able to police themselves.
E)  The SEC's powers are broad with respect to enforcement of its reporting requirements as established in the 1933 and 1934 acts,but narrow with respect to new reporting requirements because these require confirmation by the Congress

Question 14

One of the major purposes of federal security regulation is to

Accepted Answer

A)  Establish the qualifications for accountants who are members of the profession
B)  Eliminate incompetent attorneys and accountants who participate in the registration of securities to be offered to the public
C)  Provide a set of uniform standards and test for accountants,attorneys,and others who practice before the Securities and Exchange Commission
D)  Provide sufficient information to the investing public who purchases securities in the marketplace

Question 15

The Securities act of 1933

Accepted Answer

A)  Regulates the trading of securities of publicly held companies .
B)  Regulates the initial public sale and distribution of a corporation's securities.
C)  Addresses the personal duties of corporate officers.
D)  Specifies information that is to be contained in a company's annual report.

Question 16

Which of the following situations would require adjustment to or disclosure in the financial statements?

Accepted Answer

A)  A merger discussion
B)  The application for a patent on a new production process
C)  Discussions with a customer that could lead to a 40 percent increase in the client's sales
D)  The bankruptcy of a customer who regularly purchased 30 percent of the company's output

Question 17

List the four sections of the AICPA Code of Professional Conduct.

Accepted Answer

The Code of Professional Conduct in cons...

Question 18

An Account Principles Board Opinion was concerned with disclosure of accounting policies.A singular feature of this particular opinion is that it

Accepted Answer

A)  Calls for disclosure of every accounting policy followed by a reporting entity
B)  Applies to immaterial items whereas most opinions are concerned solely with material items
C)  Applies also to accounting policy disclosures by not-for-profit entities,whereas most opinions are concerned solely with accounting practices of profit-oriented entities
D)  Prescribes a rigid format for the disclosure of policies to be reported upon

Question 19

Major,Major,and Sharpe,CPA's ,are the auditors of MacLain industries.In connection with the public offering of $10 million of MacLain securities,Major expressed an unqualified opinion as to the financial statements.Subsequent to the offering,certain misstatements and omissions are revealed.Major has been sued by the purchasers of the stock offered pursuant to the registration statement,which include the financial statements audited by Major.In the ensuing lawsuit by the MacLain investors,Major will be able to avoid liability if

Accepted Answer

A)  The errors and omissions were caused primarily by MacLain
B)  It can be shown that at least some of the investors did not actually read the audited financial statements
C)  It can prove due diligence in the audit of the financial statements of MacLain
D)  MacLain had expressly assumed any liability in connection with the public offering

Question 20

The discrete view of interim reporting

Accepted Answer

A)  Holds that an interim period is a separate accounting period; thus,revenues and expenses should be treated as though they occurred only in one period.
B)  Holds that revenues and expenses should be allocated to the various interim periods.
C)  Holds that revenues and expenses should be reported as they occur.
D)  Holds that an interim period is an integral part of the annual reporting period.

Exam 17: Financial Reporting Disclosure Requirements and Ethical Responsibilities

Correct Answer
verified

A major impact of the Foreign Corrupt Practices Act of 1977 is that registrants subject to the Securities Exchange Act of 1934 are now required to

Correct Answer
verified

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example supplementary information that should be disclosed because it affects an area that is directly affected by existing FASB Standards

Correct Answer
verified

Footnotes to a company's financial statements are used to

Correct Answer
verified

List and explain the three types of financial analysts.

Correct Answer
verified
Professional security analysts make inve...
View Answer

Under the Securities Act of 1933,subject to some exceptions and limitations,it is unlawful to use the mails or instruments of interstate commerce to sell or offer to sell a security to the public unless

Correct Answer
verified
C

Which SEC reporting form is the normal registration statement for securities to be sold to the public?

Correct Answer
verified

What information is required to be included in the MD & A section of the 10-K annual report.Do not include the information required by item 7a).

Correct Answer
verified
Basically,the MD&A section evaluates the...
View Answer

Footnotes to financial statements should not be used to

Correct Answer
verified

The inclusion of MD&A Management Discussion and Analysis) in annual reports is required by the

Correct Answer
verified
C

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example supplementary information that should be disclosed because it affects an area that is directly affected by existing FASB Standards

Correct Answer
verified

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example information that should be disclosed in the notes to financial statements because it is basic to the financial statements

Correct Answer
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B

The Securities and Exchange Commission SEC) was established in1934 to help regulate the U.S.securities market.Which of the following statements is true concerning the SEC?

Correct Answer
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One of the major purposes of federal security regulation is to

Correct Answer
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The Securities act of 1933

Correct Answer
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Which of the following situations would require adjustment to or disclosure in the financial statements?

Correct Answer
verified

List the four sections of the AICPA Code of Professional Conduct.

Correct Answer
verified
The Code of Professional Conduct in cons...
View Answer

An Account Principles Board Opinion was concerned with disclosure of accounting policies.A singular feature of this particular opinion is that it

Correct Answer
verified

Correct Answer
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The discrete view of interim reporting

Correct Answer
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Exam 17: Financial Reporting Disclosure Requirements and Ethical Responsibilities

Correct AnswerverifiedShow Answer

A major impact of the Foreign Corrupt Practices Act of 1977 is that registrants subject to the Securities Exchange Act of 1934 are now required to

Correct AnswerverifiedShow Answer

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example supplementary information that should be disclosed because it affects an area that is directly affected by existing FASB Standards

Correct AnswerverifiedShow Answer

Footnotes to a company's financial statements are used to

Correct AnswerverifiedShow Answer

List and explain the three types of financial analysts.

Correct AnswerverifiedProfessional security analysts make inve...View AnswerShow Answer

Under the Securities Act of 1933,subject to some exceptions and limitations,it is unlawful to use the mails or instruments of interstate commerce to sell or offer to sell a security to the public unless

Correct AnswerverifiedC

Which SEC reporting form is the normal registration statement for securities to be sold to the public?

Correct AnswerverifiedShow Answer

What information is required to be included in the MD & A section of the 10-K annual report.Do not include the information required by item 7a).

Correct AnswerverifiedBasically,the MD&A section evaluates the...View AnswerShow Answer

Footnotes to financial statements should not be used to

Correct AnswerverifiedShow Answer

The inclusion of MD&A Management Discussion and Analysis) in annual reports is required by the

Correct AnswerverifiedC

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example supplementary information that should be disclosed because it affects an area that is directly affected by existing FASB Standards

Correct AnswerverifiedShow Answer

According to the disclosure requirements outlined in Statement of Accounting Concepts No.5,the following is an example information that should be disclosed in the notes to financial statements because it is basic to the financial statements

Correct AnswerverifiedB

The Securities and Exchange Commission SEC) was established in1934 to help regulate the U.S.securities market.Which of the following statements is true concerning the SEC?

Correct AnswerverifiedShow Answer

One of the major purposes of federal security regulation is to

Correct AnswerverifiedShow Answer

The Securities act of 1933

Correct AnswerverifiedShow Answer

Which of the following situations would require adjustment to or disclosure in the financial statements?

Correct AnswerverifiedShow Answer

List the four sections of the AICPA Code of Professional Conduct.

Correct AnswerverifiedThe Code of Professional Conduct in cons...View AnswerShow Answer

An Account Principles Board Opinion was concerned with disclosure of accounting policies.A singular feature of this particular opinion is that it

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The discrete view of interim reporting

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Professional security analysts make inve...
View Answer

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C

Correct Answer
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Correct Answer
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Basically,the MD&A section evaluates the...
View Answer

Correct Answer
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Correct Answer
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C

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Correct Answer
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B

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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The Code of Professional Conduct in cons...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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