19 Questions
Which concept states that financial transactions should be recorded when they occur, regardless of whether a cash transfer has been made?
Accrual concept
What concept assumes that a business entity will continue its operations at an indefinite period of time?
Going concern concept
Which principle requires that revenues and expenses must be matched in the same period?
Matching principle
What assumption states that only events and transactions which can be measured and expressed in monetary terms are recorded in the books of accounts?
Monetary unit assumption
Which principle requires that all material items must be properly reported in the financial statements?
Materiality concept
What concept states that assets and liabilities of a business should be presented in accounting records at their historical cost?
Historical cost concept
Which principle requires disclosing all the relevant and appropriate financial and non-financial information in the financial statements?
Full disclosure principle
What principle states that a business should use the same accounting policies and methods for recording similar events or transactions from one financial period to another?
Consistency principle
What concept ensures that financial reports users must be able to compare these reports with previous years and with reports of other entities?
Comparability concept
What is the accounting process of organizing data in a chronological order for the purpose of preparation of financial statements?
Finalizing (Post-closing Trial Balance)
Who primarily uses management accounting for decision making?
Internal management
Which branch of accounting involves the categorizing, tracing, and collecting of manufacturing costs?
Cost accounting
For what purpose does the government use financial accounting?
For budget allocation and utilization
Which form of business organization has a separate legal personality from its owners?
Corporation
What type of business involves buying, processing, and selling products?
Manufacturing
Which external user is interested in the continuous availability of products and related accessories?
Customers
What is the main function of accounting?
$1(2)$ economic decisions
Which branch of accounting involves the review, examination, verification, evaluation or inspection of financial records?
Auditing
What does management accounting primarily focus on?
Internal management for decision making
Learn about the definition of accounting as a service activity providing quantitative financial information and the different branches of accounting including financial accounting, management accounting, and cost accounting.
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