Definition of Accounting
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Questions and Answers

What is the main orientation of accounting?

  • Quantitative information (correct)
  • Non-measurable information
  • Qualitative information
  • Nonfinancial information

    • Which type of reports are financial in nature?

  • Financial accounting reports (correct)
  • Management accounting reports
  • Nonfinancial accounting reports
  • Tax accounting reports

    • How does accounting affect decision making?

  • It is irrelevant to decision making
  • It provides necessary information for decision making (correct)
  • It forces decisions on users
  • It increases uncertainty in decision making

    • What is the style followed by accounting as an art to make its reporting more meaningful?

    <p>Maintains a slant format in journal entries</p> Signup and view all the answers

    Which function of accounting ensures that all business transactions are recorded in an acceptable manner?

    <p>Recording</p> Signup and view all the answers

    In what part of accounting are users of financial information able to assess functions like recording and classifying?

    <p>'Financial statements' analysis</p> Signup and view all the answers

    What is the primary purpose of accounting?

    <p>Communicating financial information to interested users</p> Signup and view all the answers

    According to the Accounting Standards Council (ASC), accounting is primarily focused on providing:

    <p>Financial information for decision-making</p> Signup and view all the answers

    How does the Committee on Accounting Technology of the American Institute of Certified Public Accountants define accounting?

    <p>A process to summarize transactions in a significant manner</p> Signup and view all the answers

    What is the role of American Accounting Association (AAA) in defining accounting?

    <p>Permitting informed judgment by users</p> Signup and view all the answers

    In the context of accounting, what does the term 'service activity' refer to?

    <p>Delivering quantitative financial information to users</p> Signup and view all the answers

    Why does the need for effective and efficient information from the accounting cycle increase?

    <p>To facilitate better decision-making by stakeholders</p> Signup and view all the answers

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