2012 Students: These sample questions were pulled from last year’s exam. Note that not all the material covered to this point matches up with what I did last year. Hence some material below may be unfamiliar to you. However, these are reasonably representative of the type of questions you are likely to see. 1.Financial accounting a) provides useful information primarily for external decision makers. b) is required for corporations but probably would not be done by other business entities. c) provides information primarily for the use of managers of the company. d) has been practiced in this country for approximately the last 15 years. 2. The Financial Accounting Standards Board employs a "due process" system for making GAAP. This process… a. is an efficient system for collecting dues from members. b. enables interested parties to express their views on issues under consideration. c. establishes new standards based only on FASB board members’ discussions. d. requires that all accountants must receive a copy of financial standards. 3. A decrease in net assets arising from peripheral or incidental transactions is called a(n) a. capital expenditure. b. cost. c. loss. d. expense. 4. An accounting record into which the essential facts and figures are posted when it is time to make the financials is called the a. general ledger. b. cash flow statement. c. trial balance. d. general journal. e. Major General. 5. If, during an accounting period, an expense item has been incurred and consumed but not yet paid for or recorded, then the end-of-period adjusting entry would involve a. a liability account and an asset account. b. an asset or contra-asset and an expense account. c. a liability account and an expense account. d. a receivable account and a revenue account. 6. Forbes Company paid $4,800 on June 1, 2001 for a two-year