FA Financial Reporting & Analysis

Question 1

Which financial statement provides a snapshot of a company's financial position at a specific point in time?

Accepted Answer

Balance Sheet

Answer

Income Statement

Answer

Cash Flow Statement

Answer

Statement of Retained Earnings

Question 2

Under US GAAP, which inventory costing method assumes the most recently purchased items are sold first?

Accepted Answer

LIFO

Answer

FIFO

Answer

Weighted Average Cost

Answer

Specific Identification

Question 3

What does EBITDA stand for?

Accepted Answer

Earnings Before Interest, Taxes, Depreciation, and Amortization

Answer

Earnings Before Income Taxes, Depreciation, and Amortization

Answer

Earnings Before Interest, Taxes, Dividends, and Appreciation

Answer

Earnings Before Income, Taxes, Debt, and Amortization

Question 4

Which accounting principle requires that expenses be recognized in the same period as the revenues they helped generate?

Accepted Answer

Matching Principle

Answer

Revenue Recognition Principle

Answer

Conservatism Principle

Answer

Historical Cost Principle

Question 5

A company has total assets of $500,000 and total liabilities of $200,000. What is shareholders' equity?

Accepted Answer

$300,000

Answer

$700,000

Answer

$200,000

Answer

$100,000

Question 6

Which depreciation method allocates an equal amount of depreciation expense to each accounting period over an asset's useful life?

Accepted Answer

Straight-Line

Answer

Double-Declining Balance

Answer

Sum-of-Years-Digits

Answer

Units of Production

Question 7

Which of the following is classified as an operating activity in the cash flow statement under US GAAP?

Accepted Answer

Collection of accounts receivable

Answer

Issuance of common stock

Answer

Payment of dividends to shareholders

Answer

Purchase of long-term equipment