QUESTION 12

All of the following are typically included in the Managements Discussion and Analysis in annual reports except:

	1.	journal entries.
	2.	explanations of any significant changes between the current and prior years financial statements.
	3.	off-balance-sheet arrangements
	4.	managements assessment of liquidity.

Question 13

Which of the following is required by the Sarbanes-Oxley Act of 2002?

	1.	A common-sized statement.
	2.	A price-earnings ratio.
	3.	A vertical analysis.
	4.	A report on internal control.

QUESTION 14

The main disadvantage of the direct method of reporting cash flows from operating activities is that the necessary data are often costly to accumulate.

	1.	False
	2.	True