CFA历年考题以及相关资料 Quiz.docVIP

PAGE PAGE 20 七 Investment Tools: Financial Statement Analysis: Basic Concepts 1.A: Preliminary Reading Measuring Business Income Question ID: 16608 Net income is defined as the difference between: A. liabilities and assets. B. owners’ equity and expenses. C. profit and expenses. D. revenues and expenses. D Net income is the difference between revenues and expenses. The difference between assets and liabilities is net assets and the difference between profit and expenses and owners equity and expenses is not defined in accounting terms. Question ID: 16611 The initial recording of unearned revenue would generate a: A. credit to cash. B. debit to revenue. C. debit to cash. D. debit to prepaid expense. C To record unearned revenue you would debit cash and credit unearned revenue. This is due to the revenue not being earned when the cash is received. When the revenue is earned then another entry would be made to debit unearned revenue and credit revenue. Question ID: 16610 Accumulated depreciation is the result of: A. writing off an asset. B. purchasing land. C. an expense being prepaid. D. capitalizing an asset. D Capitalizing an asset means writing off the benefit of the asset over its useful life, this in turn creates depreciation expense and accumulated depreciation. Question ID: 16612 Accrual basis of accounting is considered better than the cash basis because: A. it produces more useful financial statements. B. it matches liabilities with expenses. C. revenue is recognized when cash is received. D. adjusting entries are NOT required. A Accrual basis accounting follows the matching principle – expenses are recognized in the same period in which the associated revenues are generated, thus making for more useful financial statements. Question ID: 16609 Which of the following principles does NOT result in adjusting entries being made? A. Revenue recognition. B. Accrual basis of accounting. C. Cash basis of accounting. D. The matching principle. C The cash basis of a