The accrual basis of accounting:

Is more useful than cash basis & generally accepted for external reporting

The Accounting Equation is

Assets = Liabilities + Proprietorship

planned process for providing financial info

Business Management and Administration

How do you calculate basic "cost of goods sold"?

open stock + purchases - closing stock = cost of goods sold

Which sequence correctly summarizes the accounting process?

journalize trans, post to accounts, prepare trail balance

Which of these is NOT a purpose of management accounting?

To guarantee a profit each year

The accounting process begins with

analysis of business transactions and source documents

What is the purpose of management accounting?

To provide information for use within an organisation

The two basic sources of corporate capital are

paid-in capital and retained earnings

What is the purpose of accounting in business?

To track financial transactions

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Accounting concept

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Questions 81

Answers

1
The basic accounting equation is in balance when the creditor and ownership claims against the business equal the assets
True
False
2
The accrual basis of accounting:
Is more useful than cash basis & generally accepted for external reporting
Recognizes revenue when cash is received
Who cares, I don't have to take ACC 112
Is flawed because it gives complete information about cash flows
3
Accounting is the information system that
measures business activites
communicates the results to decision makers
processes information into reports
all of the above
4
The Accounting Equation is
Assets = Liabilities + Proprietorship
Assets = Liabilities - Proprietorship
Proprietorship = Assets + Liabilities
None of the above
5
Bookkeeping and accounting are one and the same because the bookkeeping function includes the accounting process.
True
False
6
Management accounting is a technique of selective nature.
TRUE
FALSE
7
Transactions that can be measured in terms of money should be recorded in the accounting records.
True
False
8
Management accounting is basically concerned with accounting information which is useful to management.
TRUE
FALSE
9
Accounting system is
None are correct.
organized summaries of financial records
planned process for providing financial info
unplanned process for recording data
10
Management accounting must have behaviorial and interpersonal skill.
False
True
11
Management accounting is not helpful to management in discharging its functions
TRUE
FALSE
12
A basic assumption underlying short-term memory is that it is
unlimited in capacity
long-lasting
resistant to decay
limited in capacity
13
What part of the accounting equation is salaries?
Expenses
Owner’s Equity
Liabilities
Assets
14
In business accounting, the difference between revenue and expenses is called...
Ebay
Hyperinflation
Margin
Pay Per Click
15
What is the Accounting Equation?
Assets = Liabilities + Equity
Current Assets = Liabilities + Equity
Equity = Liabilities + Assets
Liabilities = Assets + Equity
16
What part of the accounting equation is land?
Revenue
Liabilities
Assets
Expenses
17
which accounting characteristic "statements can be compared with those from previous years"
understandability
timeliness
comparability
verifiability
18
General Management
Human Sevices
Health Science
Business Management and Administration
Architecture and Construction
19
How do you calculate basic "cost of goods sold"?
open stock - purchases - closing stock = cost of goods sold
open stock + purchase + closing stock = cost of goods sold
Close stock plus purchases minus opening stock = COGS
open stock + purchases - closing stock = cost of goods sold
20
The most basic economic system is a
traditional
command
mixed
market
21
Which principle/concept states businesses should use the same accounting method for all periods
disclosure
materiality
conservatism
consistency
22
Which sequence correctly summarizes the accounting process?
journalize trans, post to accounts, prepare trail balance
post to accounts, journalize trans, prepare trail balance
prepare trail balance, journalize trans, post to accounts
journalize trans, prepare trail balance, post to accounts
23
Which of these is NOT a purpose of management accounting?
To help the organizations achieve its revenue and profit goals
To give organizations a method to set direction and assess results
To help the organization make better decisions
To guarantee a profit each year
24
Management accounting deals only with the information which is useful to the management.
TRUE
FALSE
25
For accounting purposes, the partnership affairs should be kept separate from the personal activities of the owners.
False
True
26
The accounting process begins with
preparation of the trial balance.
analysis of business transactions and source documents
presenting financial information to decision-makers
preparing financial statements
27
Management accounting deals with what kind of information?
None
Qualitative
Both
Quantitative
28
Financial and Accounting Software
Airline Reservation System
Payroll
Office Suite
29
Name for the management position responsible for supervising the quality of accounting
Comptroller
Controller
Controlla
Compton
30
Turnover is an accounting concept that calculates how quickly a business does nothing.
True
False
31
What is the purpose of management accounting?
To provide information to work out the profit for a business
To provide information for use by external organisations
To provide information for use within an organisation
To provide a job for apprentices
32
The two basic sources of corporate capital are
retained earnings and dividends
preferred and common
paid-in capital and retained earnings
assets abd equity
33
The accounting concept that's applied when business transactions are stated in numbers is
Realization of Revenue
Business Entity
Going Concern
Unit of Measurement
34
The accounting concept that requires every business be accounted for separately is called...
Cost principle
Time-period assumption
Going-concern assumption
Business entity assumption
35
Identify the basic concept (i.e. assumption, accounting principle) that best applies to the statement
Full Disclosure
Measurement Principle
Expense Recognition
Economic Entity
36
The accounting concept that matches preparing a worksheet at the end of a fiscal period is
historical cost
accounting period cycle
adequate disclosure
matching revenue with expenses
37
A concept that details competition in pricing among businesses
capitalism
tradition
market
free enterprise
38
Auditing of management accounting is compulsory
FALSE
TRUE
39
Which of the following words DOES NOT describe a main focus of management accounting?
B. Control
D. Decision-making
A. Planning
C. External
40
Management accounting is basically concerned with accounting information which is useful to management.
False
True
41
Which of these is NOT an accounting equation
L = A - OE
OE = A - L
A = L + OE
A = OE - L
42
Accounting procedures must be followed for transactions affecting a business financially is
Principle of Objective Evidence
Principle of Materiality
The Realization Principle
Business Entity Concept
43
The prepaid concept became the foundation for ___ insurance
Prudential
Aetna
State Farm
Blue Cross
44
The origin of management accounting is due to limitations of Financial accounting and cost accounting
False
True
45
Which of the following is most closely linked to accounting conservatism?
materiality concept
consistency principle
disclosure principle
lower-of-cost or market rule
46
Management accounting is a structure of decision making
FALSE
TRUE
47
Dual aspect concept is the basic of accounting equation
True
False
48
Management accounting provides decision to management.
FALSE
TRUE
49
What is the purpose of accounting in business?
To track financial transactions
Determine warehouse needs
Buy production equipment
Evaluate advertising activities
50
Accounting
Education and Training
Business Management and Administration
Finance
Information Technology
51
Management accounting is concerned with the transaction related to________?
Future
Present
All
Past
52
Which requires accounting information to be complete, neutral, and free from material error?
faithful representation concept
going concern assumption
economic entity assuption
cost principle
53
What part of the accounting equation is cash?
Assets
Expenses
Owner’s Equity
Liabilities
54
The study of accounting is not useful for a business career unless your career objective is to become an accountant.
False
True
55
Accounting information is used only by external users with a financial interest in a business enterprise.
False
True
56
A record summarizing all the information pertaining to a single item in the accounting equation
account title
account balance
capital
account
57
The accounting process begins with
preparing financial statements
analysis of business transactions and source documents
preparation of the trial balance.
presenting financial information to decision-makers
58
How does management accounting is important to hospitality industry?
To ensure the accuracy of separate branch accounting
To collect and analyze internal financial information for managers
To help the decision of buying products for consumers
To disclose the effect of change in accounting policy
59
The two main inventory accounting systems are the...
perpetual and periodic
cash and accrual
returns and allowances
purchase ans sale
60
Management does.......
Planning/Goal Setting
Quality Control
61
Who is the Father of Accounting?
Sir Giorgio Piccinini
Fra Luca Pacioli
Fr. Loco Bourgouise
Alfredo M. Velayo
62
Why should businesses keep accurate accounting records?
to eliminate risks
to follow procedure
to be able to apply for credit
to regulate taxes
63
The basic role of the United States government is to:
limit business startups
maintain control of prices
increase production
protect U.S. citizens
64
Generally Accepted Accounting Principles (GAAP) are currently formulated by the
American Institute of Certified Public Accountants (AICPA)
Institute of Management Accountants (IMA)
Financial Accounting Standards Board (FASB)
Securities and Exchange Commission (SEC)
65
All of the following are basic financial statements except:
Statement of Owner's Equity
Cash Flow Statement
Income Statement
Trial balance
66
The accounting concept that states to keep business & personal records separate is
Business Entity
Realization of Revenue
Matching Expenses w/Revenue
Unit of Measurement
67
Which of the following is true of accrual basis accounting and cash basis accounting?
all of the above are true
Accrual accounting records revenue only when it is earned
cash basis accounting records all transactions
accrual accounting is not allowed under GAAP
68
Management accounting will not provide information in a prescribed proforma like that of Financial accounting
TRUE
FALSE
69
The accounting concept that's applied when business transactions are stated in numbers is
Realization of Revenue
Business Entity
Unit of Measurement
Going Concern
70
Management accounting and cost accounting are complementary in nature.
False
True
71
The role of accounting in business often involves:
tracking income and expenses
paying employees
buying supplies
obtaining funds
72
Financial accounting rules and concepts are known as...
SEC
FASB
GAAP
OMG
73
The accounting principle that requires accounting info to be based on actual cost is
Going-concern assumption
realization principle
Business entity assumption
Measurement (Cost) principle
74
The marketing concept is all about the....
Customer
Retailer
Marketer
Wholesaler
75
Period of reporting in management accounting may be weekly, fortnightly and monthly.
FALSE
TRUE
76
Management accounting is a structure for
Cost accounting
Financial accounting
Budgeting
Decision making
77
Management Accounting and Cost Accounting are Synonymous
TRUE
FALSE
78
The first accounting standards were introduced by what organization?
IFRIC
FASB
AICPA
IASB
79
The accounting concept that states to keep business & personal records separate is
Realization of Revenue
Matching Expenses w/Revenue
Unit of Measurement
Business Entity
80
A recurring object or concept within a play that enhances the theme.
Allusion
Motif
Symbol
Archetypes
81
Accountants use depreciation as it fits with the accounting concept of
going concern
Accruals
business entity
materiality

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