University of Washington, Tacoma ACCT 625ACCT 625 Ch02 TB ACCT 625 Ch02 TB .

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CHAPTER 2 MULTIPLE CHOICE 1. 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 p... rinciple? a. full disclosure b. materiality c. matching d. going concern e. realization ANS: C 2. Who is responsible for the preparation and integrity of financial statements? a. a cost accountant b. management c. an auditor d. a bookkeeper e. the FASB ANS: B 3. Which of the following is not an objective of the SEC's integrated disclosure system? a. to coordinate the Form 10-K requirements with those of the annual report b. to lessen the impact of the FASB c. to expand the management discussion of liquidity, capital resources, and results of operations d. to improve the quality of disclosure e. to standardize information requirements ANS: B 4. Which of the following is not a type of audit opinion? a. unqualified opinion b. qualified opinion c. adverse opinion d. clean opinion e. disclaimer of opinion ANS: D 5. Which of the following statements is not true? a. A qualified opinion or an adverse opinion may bring into question the reliability of the financial statements. b. A disclaimer of opinion indicates that one should not look to the auditor's report as an indication of the reliability of the statements. c. In some cases, outside accountants are associated with financial statements when they have performed less than an audit. d. A review is substantially less in scope than an examination in accordance with generally accepted auditing statements. e. The accountant's report expresses an opinion on reviewed financial statements. ANS: E [Show More]

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