6/15/22, 10:46 AM Assessment Review - Corporate Finance Institute

Reading Financial Statements

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1 Which is the best description of authorized shares?

Your Answer
The total amount of shares that can be sold

Correct Answer
The total amount of shares that can be sold

Explanation
None.

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2 Which is not a type of note found in a set of financial statements?

Your Answer
Significant internal controls

Correct Answer
Significant internal controls

Explanation
None.

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3 Where would unearned revenue most likely appear in a set of financial statements?

Your Answer
In the Balance Sheet as a liability

Correct Answer
In the Balance Sheet as a liability

Explanation
None.

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4 Which is not an example of an intangible asset?

Your Answer
A computer

Correct Answer
A computer

Explanation
None.

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5 What will a contingency note contain?

Your Answer
A circumstance where a company may have a liability

Correct Answer
A circumstance where a company may have a liability

Explanation
None.

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6 Where would advertising costs normally be found?

Your Answer
On the income statement, within selling, general and administration

Correct Answer
On the income statement, within selling, general and administration

Explanation
None.

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7 What is an advantage to using a multi-step income statement?

Your Answer
Direct expenses and indirect expenses are broken out separately

Correct Answer
Direct expenses and indirect expenses are broken out separately

Explanation
None.

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8 Which of the following is an example of an investing activity?

Your Answer
Issuance of shares

Correct Answer
Purchase of machinery

Explanation
None.

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9 Which statement does NOT describe operating cash flows?

Your Answer
Cash Paid for New Factory Equipment

Correct Answer
Cash Paid for New Factory Equipment

Explanation
None.

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6/15/22, 10:46 AM Assessment Review - Corporate Finance Institute

10 What would you find on the Management's Discussion and Analysis (MD&A) Section of an Annual Report?

Your Answer
All of the above

Correct Answer
All of the above

Explanation
None.

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