OVERVIEW OF CORPORATE FINANCIAL REPORTING

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CHAPTER 1

OVERVIEW OF CORPORATE FINANCIAL REPORTING

SUMMARY OF QUESTION TYPES BY LEARNING OBJECTIVE,

BLOOM’S TAXONOMY, LEVEL OF DIFFICULTY, AACSB CODES , AND

CPA CODES

Item LO BT LOD AACSB CPA Item LO BT LOD AACSB CPA Item LO BT LOD AACSB CPA True-False Statements

1. 1 K M AN F 11. 4 K E AN F 21. 5 K M AN F

2. 1 K E AN F 12. 5 K E AN F 22. 5 K E AN F

3. 1,5 K M AN F 13. 5 K E AN F 23. 5 K E AN F

4. 2 K E AN F 14. 5 K E AN F 24. 5 K M AN F

5. 2 K E AN F 15. 5 K M AN F 25. 5 K E AN F

6. 2 K E AN F 16. 5 K E AN F 26. 5 K M AN F

7. 4 K E AN F 17. 5 K E AN F 27. 5 K M AN F

8. 4 K M AN F 18. 5 K E AN F 28. 5 C E AN F

9. 4 K M AN F 19. 5 K E AN F 29. 5 K E AN F

10. 4 K M AN F 20. 5 K E AN F 30. 5 K M AN F

Bloom’s: AN = Analytic AP = Application C = Comprehension K = Knowledge

LOD: E = Easy M = Medium H = Hard

AACSB: AN = Analytic

CPA: F = Financial Reporting

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SUMMARY OF QUESTION TYPES BY LEARNING OBJECTIVE,

BLOOM’S TAXONOMY, LEVEL OF DIFFICULTY, AACSB CODES , AND

CPA CODES (CONT’D)

Item LO BT LOD AACSB CPA Item LO BT LOD AACSB CPA Item LO BT LOD AACSB CPA Multiple Choice Questions

31. 1 K E AN F 51. 4 C M AN F 71. 5 C M AN F

32. 1 K M AN F 52. 4 C M AN F 72. 5 K M AN F

33. 1 K M AN F 53. 4 C E AN F 73. 5 K M AN F

34. 2 K E AN F 54. 4 C E AN F 74. 5 C H AN F

35. 2 K E AN F 55. 4 C E AN F 75. 5 K M AN F

36. 2 K M AN F 56. 4 C M AN F 76. 5 C M AN F

37. 2 K E AN F 57. 4 C M AN F 77. 5 K E AN F

38. 2 K M AN F 58. 4 C M AN F 78. 5 K M AN F

39. 2 K E AN F 59. 4 C M AN F 79. 5 K E AN F

40. 2,3 C M AN F 60. 4 C M AN F 80. 5 K M AN F

41. 3 C M AN F 61. 4 C M AN F 81. 5 K M AN F

42. 3 C M AN F 62. 4 C M AN F 82. 5 K E AN F

43. 3 K E AN F 63. 5 K E AN F 83. 5 K M AN F

44. 3 K E AN F 64. 5 K E AN F 84. 5 K M AN F

45. 3 K M AN F 65. 5 AP M AN F 85. 5 K E AN F

46. 3 K M AN F 66. 5 K H AN F 86. 5 K M AN F

47. 3 K M AN F 67. 5 K E AN F 87. 5 K E AN F

48. 3 K M AN F 68. 5 C H AN F

49. 4 K M AN F 69. 5 K E AN F

50. 4 K M AN F 70. 5 K M AN F

Exercises

88. 5 AP E AN F 90. 5 AP M AN F 92. 5 AN H AN F

89. 5 AP M AN F 91. 5 AN H AN F

Matching

93. 4 C M AN F 94. 5 K M AN F

Short-Answer Essay

95. 2 K M AN F 97. 3 C M AN F 99. 5 C M AN F

96. 3 K M AN F 98. 4 K M AN F 100. 5 K M AN F

Essay

101. 4 C H AN F 102. 5 C M AN F

Bloom’s: AN = Analytic AP = Application C = Comprehension K = Knowledge

LOD: E = Easy M = Medium H = Hard

AACSB: AN = Analytic

CPA: F = Financial Reporting

Overview of Corporate Financial Reporting 1 - 3

Copyright © 2018 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited

SUMMARY OF LEARNING OBJECTIVES BY QUESTION TYPE

Item Type Item Type Item Type Item Type Item Type Item Type Item Type Learning Objective 1

1. TF 2. TF 3 TF 31. MC 32. MC 33. MC

Learning Objective 2

4. TF 6. TF 35. MC 37. MC 39. MC 95. SAE

5. TF 34. MC 36. MC 38. MC 40. MC

Learning Objective 3

40. MC 42. MC 44. MC 46. MC 48. MC 97. SAE

41. MC 43. MC 45. MC 47. MC 96. SAE

Learning Objective 4

7. TF 11. TF 52. MC 56. MC 60. MC 98. SAE

• TF 49. MC 53. MC 57. MC 61. MC 101. Es

9. TF 50. MC 54. MC 58. MC 62. MC

• TF 51. MC 55. MC 59. MC 93. Ma

Learning Objective 5

• TF 20. TF 28. TF 68. MC 76. MC 84. MC 92. Ex
• TF 21. TF 29. TF 69. MC 77. MC 85. MC 94. Ma

14. TF 22. TF 30. TF 70. MC 78. MC 86. MC 99. SAE

15. TF 23. TF 63. MC 71. MC 79. MC 87. MC 100. SAE

• TF 24. TF 64. MC 72. MC 80. MC 88. Ex 102. Es
• TF 25. TF 65. MC 73. MC 81. MC 89. Ex
• TF 26. TF 66. MC 74. MC 82. MC 90. Ex
• TF 27. TF 67. MC 75. MC 83. MC 91. Ex

Note: TF = True-False Ex = Exercise SAE = Short-Answer Essay

MC = Multiple Choice Ma = Matching Es = Essay

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Copyright © 2018 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited

CHAPTER LEARNING OBJECTIVES

• Define financial accounting and understand its relationship to economic decision

making.• Financial accounting is the process by which information on the transactions of an organization is captured, analyzed, and reported to external decision makers.• These decision makers are referred to as financial statement users and include investors and creditors.• The primary purpose of financial accounting information is to aid these users in making economic decisions related to the reporting organization, such as whether to invest in it or lend it money.

• Identify the main users of financial accounting information and explain how they use

this information.• The main users of financial accounting information include shareholders, the board of directors, potential investors, creditors (bankers and suppliers), regulators (stock exchanges), taxing authorities (governments), securities analysts, and others.• Shareholders, the board of directors, and potential investors will use financial accounting information to enable them to assess how well management has run the company; determine whether they should buy, sell, or continue to hold shares in the company; assess the company’s share price relative to the financial accounting information; and so on.• Creditors will use financial accounting information to determine whether they should lend funds to the company, establish credit terms for it, assess a company’s ability to meets its obligations, and so on.• Regulators will use financial accounting information to determine whether a company has met its listing requirements.• Taxing authorities will use this information in assessing the taxes owed by the organization.

• Describe the major forms of business organization and explain the key distinctions

between each form.• There are three major forms of business organization: (1) proprietorships, (2) partnerships, and (3) corporations.• There are public corporations (whose shares trade on a public stock exchange and are widely held) and private corporations (whose shares do not trade on a public exchange and are generally owned by a small number of people).• Corporations are separate legal entities, whereas proprietorships and partnerships are not.This means the personal assets of owners are protected in the event of legal action against corporations, whereas they are at risk in the case of proprietorships and partnerships. It also means corporations file separate tax returns, whereas the income from proprietorships and partnerships is reported on the personal tax returns of their owners.

• Explain the three categories of business activities and identify examples of

transactions related to each category.• The three categories of business activities are: (1) operating, (2) investing, and (3) financing activities.