QUESTION 7 1 points Sav Which one of the following statements about Generally Accepted Accounting Principles (GAAP) is most accurate? In the US, the Securities and Exchange Commission requires public companies to use GAAP in their financial reporting; private companies, on the other hand, are not required to follow GAAP accounting guidelines, although most do so by choice. In 20111, GAAP rules on accounting were adopted by all countries in the European Union, thus making the practice of accounting truly international for the first time ever. GAAP rules are typically very precise and require companies to value assets, liabilities, revenues, and expenses according to detailed rules specified by the Financial Accounting Bureau of Standards. All of these statements about GAAP accounting are true. QUESTION 8 1 points Sav On December 1st, Jeremy Bennett Enterprises signed a contract with Macy's to provide individuals to play Santa Claus in the various stores throughout the southeastern U.S. JBE hired the actors and they performed their services admirably from December 12th through December 24th, the time frame specified in the contract. JBE sent an invoice for the services to Macy's dated December 31st, and Macy's actually paid them for the services on January 15th. The date that JBE should record the revenue for their services ought to be December 1st December 24th December 31st January 15th 1 points Sav QUESTION 9 Which one of the following statements about "financial intelligence" is most accurate? The main difference between finance andaccounting is that finance is largely an art form, while accounting is considered to be a science. Having financial intelligence means that users of financial information can tell the difference between accounting values that are well supported and uncontroversial ("hard numbers") and accounting values that are based on judgment calls ("soft numbers"). While the timing of revenues is easy to establish, there is much more subjectivity involved in measuring expenses. On a practical level, that means that forensic accountants should focus their efforts on expenses rather than revenues when searching for fraudulent activity because revenues are generally considered to be accurate, "hard" numbers. Financial intelligence is important for accountants and investors, but other stakeholders like vendors, customers, and employees have relatively little use for this type of information. QUESTION 10 1 points Sav The main difference between a capital expenditure and an operating expense is that Capital expenditures are credit expenses (e.g., charged on a credit card) while operating expenses are those that are paid in cash. Capital expenditures are tax deductible while operating expenses are not. Capital expenditures are amounts paid for physical assets like paper for the copy machine, while operating expenses are mainly salaries for workers. Operating expenses are recorded immediately and reduce the amount of profit reported on the income statement, while capital expenditures are spread out over multiple accounting periods
