$1.$ What is the name for characteristic of the financial statements that describes how reliably the financial statements convey a firm$$s true economic performance and financial condition?

Multiple Choice

Accounting quality

Financial quality

Accounting performance

Accounting reliability

$2.$ According to Dichev, et al$.,$ of the following options, what is the most likely incentive for managers to misrepresent economic performance is:

Multiple Choice

because they feel other companies misrepresent performance

because there is outside pressure to hit earnings benchmarks

to avoid violation of debt covenants

to reduce expectations of future earnings

$3.$ If expenses are understated in the current period, it implies which of the following?

Multiple Choice

Net income is understated

Revenues are overstated

Net income is overstated

Revenues are understated

$4.$ An estimate associated with increased bad debt expense will impact which balance sheet account?

Multiple Choice

Gross accounts receivable

Gross accounts payable

Allowance for doubtful accounts

Allowance for payables

$5.$ For an $$economic resource$$ to be capitalized as an asset, GAAP requires that the economic resource have all the following characteristics, except:

Multiple Choice

represent a probable future economic benefit

be the result of a past transaction

be controlled by the firm

be material $($or big enough$)$

$6.$ What does Altman$$s Z$-$scores help the analyst to assess?

Multiple Choice

ability to continue as a going concern

risk of liquidity issues

risk of bankruptcy

chance of profitability

$7.$ A contingent liability is contingent on what?

Multiple Choice

the resolution of an uncertain future event

the decision on whether to pay dividends to shareholders

the decision by customers whether to return goods for sale

the resolution of financial performance made during the prior quarter

$8.$ What types of models are statistical prediction tools that use more than one variable to estimate $($or predict$)$ a future outcome?

Multiple Choice

Descriptive analytics

Multivariate models

Univariate statistics

Classification analysis