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Generally Accepted Accounting Principles (GAAP) Test Answers

1. At what stage in the manufacturing cycle is Raw Materials?
 Answers: • End of the manufacturing cycle, after processing is complete

 2. What did APB 14-1 issued in 2008 do to the accounting rules related to convertible debt?
 Answers: • Forced companies to convert all debt

 3. What did APB14-1 stipulate for retroactive reporting of convertible debt?
 Answers: • Any current outstanding convertible debt must be restated retroactively, any retired convertible debt does not have to be restated.

 4. What is "Work in Progress"?
 Answers: • Raw material which has been unpacked and is ready to be utilized in the manufacturing process

 5. What is "earnings per share"?
 Answers: • The ratio of a company's earnings to the number of shares outstanding

 6. What is "impairment"?
 Answers: • An asset becoming unusable

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