Advanced Accounting

Front 1

The SEC does have authority over the disclosure in Corporate annual reports, and the content in them.
(True or False)

Back 1

True

Front 2

The SEC was established in 1934 to help regulate the U.S. securities market. The SEC regulates securities of a public sale.
(True or False)

Back 2

True

Front 3

The purpose of the Securities Exchange Act of 1934 is to improve the securities of corporations that are to be traded publicly.
(True or False)

Back 3

False

Front 4

The SEC is organized into several divisions and principal offices. The organization unit that reviews registration statements, annual reports, and proxy statements filed with the Commission is

Back 4

-The Division of Corporation Finance

Front 5

Regulation S-X

Back 5

-Specifies the general form and content requirements of financial statements filed with the SEC.
EX: Preparing financial statements, footnotes, and the auditor's report.

Front 6

Regulation S-K disclosure requirements of the SEC deal with the company's business properties, and legal proceedings; selected five-year summary financial data; management's discussion and analysis of financial condition and results of operations; and

Back 6

--Supplementary financial information such a quarterly financial data and information on the effects of changing prices.

Front 7

In the registration and sales of new securities issues, the SEC

Back 7

--endorses a security's investment merit by allowing its registration to "get effective."

Front 8

The 1933 Securities Act provides for a 20-day review period between the filing and the effective date of the registration. During this review period, the registrant is prohibited from

Back 8

--Accepting offers to purchase the securities being registered from potential investors.

Front 9

Before turning over the proceeds of a securities offering to a registrant, the underwriters frequently require a comfort letter from the public accountant. The comfort letter's purpose is to

Back 9

--Indicate whether the public accountant found any adverse financial change between the date of audit and the effective date of the securities offering.

Front 10

Form 10-K is filed with the SEC to update the information a company supplied when filing a registration statement under the Securities and Exchange Act of 1934. Form 10-K is a report that is filed

Back 10

--Annually within 60 days of the end of a company's fiscal year.

Front 11

The SEC's Regulation S-X disclosure requirements address

Back 11

--The requirements for filing interim financial statements and pro forma financial information.

Front 12

Form 10-Q is filed with the SEC to keep both investors and experts apprised of a company's operations and financial position. Form 10-Q is a report that is filed within

Back 12

--35 days after the end of each of the first three quarters of each fiscal year.

Front 13

A company registered under the Securities and Exchange Act of 1934 should report a significant event affecting it on

Back 13

--Form 8-K.

Front 14

Within days four days after the occurrence of any event that is of material importance to stockholders, a company must file a Form 8-K information report with the SEC to disclose the event. An example of the type of event required to be disclosed is

Back 14

--The acquisition of a large subsidiary other than in the ordinary course of business.

Front 15

Form 8-K must generally be submitted to the SEC within four days after the occurrence of a significant event. The following event is not to be reported by Form 8-K

Back 15

--A change in Accounting principle.

Front 16

The following items is not required to be included in a company's periodic 8-K report filed with the SEC when significant events occur

Back 16

--Election of a new vice president of finance to replace the retiring incumbent.

Front 17

A major impact of the Foreign Corrupt Practices Act of 1977 is that registrants subject to the Securities Exchange Act of 1934 are required to

Back 17

--Keep records that reflect the transactions and dispositions of assets and maintain a system of internal accounting controls.

Front 18

Shareholders may ask or allow others to enter their vote at a shareholders' meeting that they are unable to attend. The document furnished to shareholders to provide background information for their vote is a

Back 18

--Proxy Statement

Front 19

Formation and meaningful utilization of an audit committee of the board of directors is required of publicly traded companies that are subject to the rules of the

Back 19

--SEC

Front 20

An external auditor's involvement with Form 10-Q that is being prepared for filing with the SEC would most likely consist of

Back 20

--A review of the interim financial statements included in Form 10-Q.

Front 21

The following statement concerning the prospectus required by the Securities Act 1933 is correct

Back 21

--The prospectus is part of the registration statement.

Front 22

The following statement would be regulated by the provisions of the Securities Act of 1933

Back 22

--Securities issued by insurance companies.

Front 23

The following securities is exempt from registrant under the Securities Act of 1933

Back 23

--A class of stock given in exchange for another class by the issuer to the existing stockholders without the issuer by the United States.

Front 24

Pix Corporation is making a $6,000,000 stock offering. Pix wants the offering exempt from registration under the Securities Act of 1933. Which of the following provisions of the act would Pix have to comply with for the offering to be exempt

Back 24

--Regulation D, Rule 506.

Front 25

An offering made under the provisions of Regulation A of the Securities Act of 1933 requires that the issuer

Back 25

--File an offering circular with the SEC.

Front 26

Which of the following factors by itself requires a corporation to comply with the reporting requirements of the Securities Exchange Act of 1934

Back 26

--Shares listed on a national securities exchange.

Front 27

The following person is not an insider of a corporation subject to the Securities Exchange Act of 1934 registration and reporting requirements

Back 27

--An owner of 5% of the corporation's outstanding debentures.

Front 28

The SEC is responsible for:

Back 28

--Full and Fair Disclosure of Information
--Regulating Securities Markets

Front 29

The Securities and Exchange Commission was created by:

Back 29

--Securities and Exchange Act of 1934

Front 30

The following divisions of the SEC regulates national securities exchange, brokers, and dealers of securities:

Back 30

--Division of Market Regulation

Front 31

The following division of the SEC develops and administers the disclosure requirements for the securities acts and reviews all registration statements and other issue-oriented disclosures:

Back 31

Division of Corporation Finance

Front 32

Securities Investor Protection Act:

Back 32

Identify the regulation that created an entity which insures investors from possible losses if an investment house enters bankruptcy.

Front 33

Reg S-X and Reg S-K:

Back 33

Govern the preparation of financial statements and associated disclosures.

Front 34

Sarbanes-Oxley Act

Back 34

Resulted in the creation of the Public Company Accounting Oversight Board.

Front 35

Regulation S-X presents the rules for preparing all except:

Back 35

Management's discussion

Front 36

The preparation of the following items is covered by Reg S-K:

Back 36

Descriptions of business

Front 37

The following presents the results of actions taken against accountants, brokers, and other
participants for filing false or misleading statements:

Back 37

Accounting and Auditing Enforcement Releases

Front 38

The following covers new or revised administrative practices and interpretations used by the
SEC staff in reviewing financial statements?

Back 38

Staff Accounting Bulletins

Front 39

In the issuer's annual report, how many years of audited financial statements must be presented?

Back 39

I. Three years of audited income statements
II. Two years of audited balance sheets
III. Three years of audited statements of cash flows

Front 40

The following types of securities or securities transactions are exempt from the need to be
registered under the Securities Act of 1933?

Back 40

I. Commercial paper with a maturity of nine months or less.
II. Intrastate issues in which the securities are offered and sold only within one state.
III. Securities exchanged by an issuer exclusively with its existing shareholders with no commission

Front 41

Regulation D of the SEC presents important exemptions from full registration requirements for:

Back 41

Private placements.

Front 42

The following forms is the most comprehensive registration statement:

Back 42

Form S-1

Front 43

When deficiencies are found in a registration statement that must be corrected before the securities may
be offered for sale, which of the following is issued by the SEC?

Back 43

A comment letter

Front 44

The purpose of a "tombstone ad" is:

Back 44

to inform investors of an upcoming offering.

Front 45

The following best describes a "red herring" prospectus:

Back 45

Preliminary information provided to investors about an upcoming issue, and issued between the time a
registration statement is presented to the SEC and its effective date.

Front 46

The following observations is true of the shelf registration rule:

Back 46

It allows large companies to select the optimal time to sell their stock.

Front 47

Accountants are liable for any materially false or misleading information contained in the registration
statement filed with the SEC up to:

Back 47

the effective date of the registration statement.

Front 48

What does an underwriter typically require from an accountant which indicates that the company has
fulfilled all the accounting requirements in the registration process?

Back 48

A comfort letter

Front 49

Which system helps the SEC accomplish its primary purpose of increasing the efficiency and fairness of
the securities markets by expediting the receipt, acceptance, dissemination, and analysis of time-sensitive
data filed with it?

Back 49

EDGAR

Front 50

Which of the following classes of information are included in the Form 10-K?

Back 50

I. Management's discussion and analysis
II. Audited financial statements and footnotes
III. Auditor's opinion on the company's internal control system

Front 51

Which of the following statements concerning Form 10-Q is NOT true?

Back 51

It is filed for all four quarters.

Front 52

Information concerning the unexpected resignation of one or more of the registrant's directors would be
disclosed on which of the following forms?

Back 52

II. Form 8-K

Front 53

Proxy statements are:

Back 53

Materials submitted to shareholders for votes on corporate matters.

Front 54

Schedule 13D is filed

Back 54

by entities that acquire a beneficial ownership of more than 5 percent of a class of registered equity
securities.

Front 55

Which of the following is defined as directly or indirectly having the power to vote the shares or
investment power to sell the security?

Back 55

Beneficial ownership

Front 56

The following is true about the Foreign Corrupt Practices Act of 1977 (FCPA):

Back 56

I. Publicly held companies should maintain an adequate system of internal control.
II. Individuals associated with U.S. companies are prohibited from bribing foreign officials for the
purpose of securing a contract.

Front 57

According to the provisions of the Sarbanes-Oxley Act:

Back 57

audit committees should be composed of non-management members of a company's board of
directors.

Front 58

The following statements concerning the management discussion and analysis (MD&A) of a
company's financial condition is true:

Back 58

I. It should cover the financial statements and other statistical data for the most recent three-year time
span.
II. It should make year-to-year comparisons of material changes in the line items.
IV. Disclosure of material off-balance sheet transactions, arrangements, and obligations is required in
each annual and each quarterly report.

Front 59

Pro forma disclosures are:

Back 59

"what-if" presentations often taking the form of summarized financial statements.

Front 60

The following statements concerning pro forma disclosures is not true:

Back 60

The SEC requires these to be presented only when the company has made an unusual asset exchange,
or a restructuring of existing indebtedness.

Front 61

Insolvency:

Back 61

is defined as a condition in which a company is unable to meet debts as the debts mature?

Front 62

Under a composition agreement:

Back 62

creditors agree to accept less than the face amount of their claims.

Front 63

The following ways can debt be restructured:

Back 63

I. Assets can be transferred to the creditor.
II. An equity interest can be granted to the creditor.
III. The terms of the debt can be modified.

Front 64

Under which nonjudicial action do creditors agree to assist the debtor in managing the most efficient
payment of creditors' claims:

Back 64

Creditors' committee management

Front 65

A transfer of assets by a company in financial difficulty is considered a sale if:

Back 65

II. the transferee obtains the right to pledge or exchange the transferred assets.
III. the transferred assets have been isolated from the transferor.
IV. the transferor does not maintain effective control over the transferred assets.

Front 66

The Bankruptcy Reform Act contains chapters which deal with:

Back 66

I. Individuals.
II. Corporations.
III. Municipal governments.

Front 67

Under the Bankruptcy Code, an insolvent corporation may be:

Back 67

I. Reorganized.
II. Liquidated.

Front 68

Which chapters of the Bankruptcy Code deal with corporations?

Back 68

Chapters 7 and 11

Front 69

Chapter 11 of the Bankruptcy Code provides for:

Back 69

I. Reorganization.

Front 70

The following could be true of the proceedings under Chapter 11 of the Bankruptcy Code:

Back 70

The debtor continues as a business after the reorganization.

Front 71

Under Chapter 11 proceedings, what represents the fair value of the entity before considering liabilities
and approximates the amount a willing buyer would pay for the entity's assets:

Back 71

Reorganization value

Front 72

A reorganization value in excess of amounts assignable to identifiable assets is:

Back 72

reported as an intangible asset called Reorganization Value in Excess of Amounts Allocable to
Identifiable Assets.

Front 73

The following observations regarding the use of fresh start accounting is true:

Back 73

It results in a new reporting entity.

Front 74

A "debtor-in-possession" balance sheet is prepared for a company which:

Back 74

is in bankruptcy reorganization but management still controls the company.

Front 75

A debtor-in-possession balance sheet should report:

Back 75

I. Liabilities not subject to compromise.
II. Liabilities subject to compromise.

Front 76

On a debtor-in-possession income statement, the following items should be reported under the
heading "Reorganization Items":

Back 76

Loss on disposal of assets

Front 77

Typically, the plan of reorganization must be approved by at least _____ of all creditors, who must hold at least _____ of the dollar amount of the outstanding debt.

Back 77

D. half; two-thirds

Front 78

Chapter 7 of the Bankruptcy Code provides for:

Back 78

II. Liquidation.

Front 79

_____ have liens, or security interests, on specific assets.

Back 79

Secured creditors

Front 80

As defined by the Bankruptcy Code, creditors with priority:

Back 80

II. are unsecured creditors who have priority over other unsecured creditors.
III. are the first to be paid from any proceeds available to unsecured creditors.

Front 81

The following observations concerning claims by general unsecured creditors is NOT true:

Back 81

They are entitled to "preference payments" at the discretion of the debtor's management.

Front 82

The payment to general unsecured creditors is often termed:

Back 82

a "dividend."

Front 83

"Preference payments" made by the debtor to one creditor to the detriment of all other creditors within 90 days before the bankruptcy petition was filed:

Back 83

may be recovered and returned to the cash available for all creditors.

Front 84

The accounting statement of affairs is prepared:

Back 84

at the beginning of the liquidation process.

Front 85

Which monthly report shows the results of the trustee's fiduciary actions beginning at the point the trustee accepts the debtor's assets?

Back 85

Statement of realization and liquidation

Front 86

The Statement of Realization and Liquidation contains sections for all the following items except:

Back 86

stockholders equity.

Front 87

In a statement of realization and liquidation, unusual revenue items are reported under:

Back 87

supplementary items.

Front 88

All of the following items are reported in a statement of realization and liquidation except:

Back 88

Cash

Front 89

Which of the following items are likely to be reported in the supplementary items section of a statement
of realization and liquidation?

Back 89

Trustee's administration fees.