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Accounting Trivia
Uncover mind-blowing accounting secrets that will shock every number lover! From the 500-year-old bookkeeping system still used today to the trillion-dollar scandals - these financial facts will astound you.
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Questions (150 of 150)
๐ขeasy
What is a payment made by a corporation to its shareholders from profits called?
๐กmedium
What is the accounting term for expenses paid in advance before they are incurred?
๐ดhard
What is the COSO framework primarily used to evaluate in organizations?
๐ดhard
What was the name of Luca Pacioli's 1494 book that contained the first published description of double-entry bookkeeping?
๐กmedium
What is the name of the fraud triangle's three elements that lead to occupational fraud?
๐ขeasy
What is the term for an independent examination of a company's financial records?
๐ขeasy
An expense that has been incurred but not yet paid is called what?
๐ขeasy
What is another name for the balance sheet?
๐ขeasy
Revenue minus cost of goods sold equals what?
๐กmedium
What famous Italian city is considered the birthplace of modern accounting and banking?
๐ขeasy
On a balance sheet, which category includes cash, inventory, and accounts receivable?
๐ขeasy
Which type of business entity has owners called shareholders?
๐ขeasy
Which accounting document lists all accounts and their balances to verify debits equal credits?
๐ดhard
What is the term for the accounting practice where two companies artificially inflate revenues by buying services from each other?
๐กmedium
What is the term for the systematic allocation of the cost of a natural resource over its life?
๐ขeasy
What is the term for recording a transaction in the accounting journal for the first time?
๐ดhard
What is the term for an accounting method where a company takes massive write-offs in one period to make future periods look better?
๐กmedium
What financial metric is calculated by subtracting current liabilities from current assets?
๐กmedium
What does the debt-to-equity ratio measure?
๐กmedium
What is the name for the annual report that publicly traded U.S. companies must file with the SEC?
๐ขeasy
What is the term for profit remaining after all expenses, taxes, and costs have been deducted?
๐ดhard
In what year did the American Institute of Certified Public Accountants (AICPA) officially form under that name?
๐ขeasy
What term describes money owed to a company by its customers?
๐ดhard
What is the name of the accounting scandal where Satyam Computer Services' chairman admitted to inflating cash balances by approximately $1.5 billion in 2009?
๐กmedium
What is the term for the amount of an asset's cost that has already been expensed through depreciation?
๐กmedium
What is goodwill in accounting?
๐ขeasy
Which side of a T-account do you record an increase in assets?
๐ขeasy
Which profession is nicknamed 'bean counters'?
๐กmedium
What is the name of the U.S. oversight body created by the Sarbanes-Oxley Act to regulate auditors of public companies?
๐ขeasy
What type of accountant typically works within a single organization rather than serving multiple clients?
๐ดhard
In what year did Ernst & Young officially rebrand to just 'EY'?
๐ดhard
In what year was the Securities and Exchange Commission (SEC) established in the United States?
๐ขeasy
Wages, rent, and utilities are examples of what type of accounting item?
๐ขeasy
What does LIFO stand for in inventory valuation?
๐ดhard
What was the name of Toshiba's 2015 accounting scandal that overstated profits by approximately how much over seven years?
๐กmedium
What accounting concept requires that financial statements include all information necessary for a user to understand them?
๐ขeasy
What is the term for the original cost of an asset as recorded in the books?
๐ดhard
What Japanese term for continuous improvement became a key concept in management accounting and lean manufacturing?
๐ขeasy
What type of accounting records transactions when cash is actually received or paid?
๐กmedium
Who is credited with publishing the first known description of double-entry bookkeeping in 1494?
๐ขeasy
Which financial statement shows a company's revenues and expenses over a period of time?
๐ดhard
What ancient Egyptian material served as the primary medium for recording accounting transactions before paper?
๐ขeasy
What does the abbreviation P&L stand for?
๐ขeasy
What is the term for the money invested by owners into a business?
๐กmedium
What is the term for the difference between a company's total revenues and total expenses when revenues are higher?
๐ขeasy
What is the term for money a company owes to its suppliers?
๐กmedium
What term describes a situation where an accountant or auditor has a conflict of interest?
๐กmedium
In the Enron scandal, what was the name of the CFO who created off-balance-sheet entities to hide debt?
๐กmedium
What document does an employer issue to report wages paid and taxes withheld for an employee?
๐ดhard
What is the term for the accounting practice of creating hidden reserves during good years to boost earnings in bad years?
๐ขeasy
What does the abbreviation CFO stand for?
๐ดhard
What is the name of the hypothesis that states stock prices fully reflect all available information, challenging the value of financial statement analysis?
๐ขeasy
What is the estimated value of an asset at the end of its useful life?
๐กmedium
In what century did double-entry bookkeeping first emerge in Italian merchant cities?
๐ดhard
Which Italian city's merchants are credited with developing the earliest forms of double-entry bookkeeping in the 13th century?
๐กmedium
What type of bond sells for less than its face value?
๐ดhard
What is the name of the SEC regulation adopted in 2000 that requires companies to disclose material information to all investors simultaneously?
๐ดhard
Which FASB Accounting Standards Codification topic governs lease accounting, effective for public companies in 2019?
๐กmedium
What international set of accounting standards is used by over 140 countries but not primarily by the United States?
๐ดhard
What does the acronym XBRL stand for, the digital reporting language used for SEC filings?
๐กmedium
What type of accounting focuses on providing information to internal management for decision-making?
๐กmedium
What major U.S. legislation was enacted in 2002 in response to the Enron and WorldCom accounting scandals?
๐กmedium
What is the term for income received in advance for goods or services not yet delivered?
๐กmedium
What is the common term for the accounting entries made at the end of a period to update account balances?
๐กmedium
What U.S. government body is responsible for setting accounting standards for public companies?
๐ดhard
What is the name of the principle that requires an entity to be accounted for separately from its owners?
๐กmedium
What accounting method records revenue when it is earned, regardless of when cash is received?
๐ขeasy
What does GAAP stand for in accounting?
๐ดhard
What is the exact number of hours of continuing professional education (CPE) most U.S. states require CPAs to complete every three years?
๐ขeasy
What is the process of transferring journal entries to the general ledger called?
๐ขeasy
What is the term for the gradual reduction in value of a tangible asset over time?
๐ขeasy
In double-entry bookkeeping, every transaction affects at least how many accounts?
๐ขeasy
Which financial statement provides a snapshot of a company's financial position at a specific point in time?
๐ดhard
What is the name for the accounting treatment under which leases previously classified as operating leases must now be recorded on the balance sheet?
๐ขeasy
What is the fundamental accounting equation?
๐ดhard
What German company's accounting fraud of $3.1 billion was exposed in 2020, leading to its insolvency?
๐กmedium
Which company's $11 billion accounting fraud in 2002 was the largest in U.S. history at that time?
๐ขeasy
An asset that can be converted to cash within one year is classified as what?
๐ดhard
What was the exact amount of the fine Arthur Andersen paid to the SEC in 2001 related to its Waste Management audit failure?
๐ดhard
What was the name of the special purpose entities used by Enron's CFO Andrew Fastow to hide billions in debt?
๐กmedium
What accounting standard update replaced the old revenue recognition rules with a five-step model in 2018?
๐ดhard
What is the name of the oldest surviving double-entry bookkeeping ledger, dating from 1340 in Genoa?
๐ขeasy
What is the bottom line on an income statement commonly called?
๐ดhard
What is the name of the medieval Italian bookkeeping method that preceded double-entry, using only single entries in a narrative format?
๐ดhard
What is the name of the FASB's conceptual framework statement that defines the objective of financial reporting?
๐กmedium
Which financial statement shows changes in a company's equity accounts over a period?
๐ขeasy
Which accounting principle requires expenses to be recorded in the same period as the revenues they help generate?
๐กmedium
What is the term for the practice of spreading revenue or expenses across multiple periods to smooth earnings?
๐กmedium
Which accounting firm, once the fifth largest in the world, collapsed in 2002 due to the Enron scandal?
๐ขeasy
What is the accounting term for the allocation of cost of an intangible asset over its useful life?
๐ดhard
What is the name of the 2001 scandal in which Adelphia Communications' founding family was found to have fraudulently excluded $2.3 billion in debt from consolidated statements?
๐ดhard
Which ancient civilization used clay tokens inside sealed clay envelopes as one of the earliest known accounting systems around 7000 BCE?
๐ดhard
What is the specific name of the PCAOB standard that governs the audit of internal control over financial reporting integrated with an audit of financial statements?
๐ดhard
What was the total amount of shareholder losses estimated from the Enron bankruptcy in 2001?
๐กmedium
Which cost accounting method assigns all manufacturing costs, both fixed and variable, to products?
๐ดhard
What is the name of the former Big Eight firm that merged with Deloitte Haskins & Sells in 1989 to form Deloitte & Touche?
๐กmedium
What is the primary professional organization for CPAs in the United States?
๐ขeasy
What accounting term refers to the owners' residual interest in a company after liabilities are deducted?
๐ขeasy
Which financial statement tracks the inflows and outflows of cash?
๐ขeasy
What term describes an asset that has no physical form, such as a patent or trademark?
๐ขeasy
What does ROI stand for?
๐กmedium
What type of liability is an obligation that may or may not occur depending on a future event?
๐ขeasy
What type of tax is levied on a company's profits?
๐ขeasy
Which accounting concept assumes a business will continue to operate indefinitely?
๐กmedium
What country is home to the International Accounting Standards Board (IASB)?
๐กmedium
What ratio measures a company's ability to pay its short-term obligations with its current assets?
๐ดhard
In Benford's Law, what is the expected probability that the leading digit of a naturally occurring number is 1?
๐ดhard
What is the threshold percentage of voting stock ownership that generally requires equity method accounting under U.S. GAAP?
๐ขeasy
What is the term for reducing the balance of an asset account through a credit entry?
๐ดhard
Which Scottish accountant is credited with developing the profession of public accounting in the 1850s?
๐ขeasy
What is the deadline for filing individual U.S. federal tax returns in most years?
๐ดhard
What was the specific IRS section number that governs retirement plans commonly known as 401(k) plans?
๐ดhard
What specific section of the Sarbanes-Oxley Act requires management to assess and report on the effectiveness of internal controls?
๐ดhard
What was the name of the first professional accounting body in the world, established in Edinburgh in 1854?
๐ขeasy
What does the acronym FIFO stand for in inventory accounting?
๐กmedium
Which Big Four firm has the most employees worldwide as of 2023?
๐กmedium
What is the maximum number of sections on the CPA exam as restructured in 2024?
๐ดhard
What was the approximate total fraud amount in the Bernie Madoff Ponzi scheme, the largest in history?
๐ดhard
What was the maximum U.S. corporate income tax rate from 1993 to 2017, before the Tax Cuts and Jobs Act reduced it?
๐ขeasy
What is the standard fiscal year-end date for the U.S. federal government?
๐ดhard
What term describes the accounting fraud technique of recording fictitious sales to distributors at the end of a quarter?
๐กmedium
What is the term for when a company records revenue before it has been earned, inflating its financial results?
๐ขeasy
What is the common term for the total amount of sales a company generates?
๐ดhard
In what year did the FASB replace the legacy accounting standards with the Accounting Standards Codification (ASC)?
๐กmedium
What is the term for the accounting practice of recording expenses when they become certain, even before payment?
๐ดhard
Which British accounting qualification, considered one of the most prestigious globally, uses the designation ACA?
๐กmedium
What accelerated depreciation method doubles the straight-line depreciation rate?
๐ดhard
What percentage of ownership generally triggers consolidation accounting, requiring a parent to combine subsidiaries' financials?
๐ดhard
What landmark 1966 publication by the American Accounting Association proposed a decision-usefulness approach to accounting theory?
๐ขeasy
What does the abbreviation CPA stand for?
๐กmedium
What depreciation method allocates an equal amount of expense to each year of an asset's useful life?
๐กmedium
What is the term for a certified accountant who investigates financial crimes and fraud?
๐ดhard
In what year did KPMG form from the merger of Peat Marwick International and Klynveld Main Goerdeler?
๐ดhard
What year did PricewaterhouseCoopers form from the merger of Price Waterhouse and Coopers & Lybrand?
๐ขeasy
Which Big Four accounting firm was founded in London in 1849?
๐กmedium
What percentage is the current U.S. federal corporate income tax rate as set by the Tax Cuts and Jobs Act of 2017?
๐กmedium
In what year was the U.S. federal income tax permanently established by the 16th Amendment?
๐กmedium
What financial ratio is calculated by dividing net income by shareholders' equity?
๐ขeasy
What do the initials IRS stand for in the United States?
๐กmedium
Which type of audit opinion indicates financial statements are presented fairly in all material respects?
๐ดhard
What is the name of the mathematical law used by forensic accountants to detect anomalies in financial data by analyzing leading digits?
๐ดhard
What is the name of the ethical framework in accounting that includes integrity, objectivity, professional competence, confidentiality, and professional behavior?
๐ดhard
What was the exact year the first CPA exam was administered in the state of New York?
๐ขeasy
What U.S. form do most individual taxpayers file annually?
๐กmedium
Which section of the cash flow statement includes activities like purchasing equipment and selling investments?
๐กmedium
Which inventory valuation method is prohibited under IFRS but allowed under U.S. GAAP?
๐กmedium
What does EBITDA stand for?
๐กmedium
What term describes recording a lower value for assets or higher value for liabilities to be cautious?
๐ขeasy
What is the name of the comprehensive list of all accounts used by a business?
๐ดhard
In what year was the Financial Accounting Standards Board (FASB) established?
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