AFM 131 Exam Accounting Finance Questions & Answers 2023/2024
Chartered Professional Accountants - ANSWER-CPA: Merge of Certified Management Accountants and Certified General Accountants
Transactions - ANSWER-Buying supplies, paying employees, and receiving a loan are all examples of
Acc...
Chartered Professional Accountants - ANSWER-CPA: Merge of Certified Management Accountants and
Certified General Accountants
Transactions - ANSWER-Buying supplies, paying employees, and receiving a loan are all examples of
Accounting System - ANSWER-The method used to record and summarize accounting data into reports
Inputs - ANSWER-Part of the accounting system: Accounting documents such as sales, purchasing or
shipping documents, payroll records, bank records, travel records, or entertainment records
Processing - ANSWER-Part of the accounting system: Entries or recordings made to journals, the effects
of these entries are then transferred or posted into ledgers (classifying)
Outputs - ANSWER-Part of the accounting system: (Financial statements) Balance sheet, income
statement, cashflow statements, and annual reports
5 Key Working Areas of Accounting - ANSWER-1.Managerial accounting
2. Financial accounting
3. Compliance (auditing)
4. Tax accounting
5. Government and not-for-profit accounting
Managerial Accounting - ANSWER-Measures and reports costs of production, marketing, and other
functions-- preparing and monitoring budgets. Provides information to managers inside the company to
assist in decision making
, Financial Accounting - ANSWER-Information for stakeholders outside the company-- is the organization
profitable?
Annual Report - ANSWER-A yearly statement of the financial condition, progress and expectations of a
company/organization
Compliance Accounting - ANSWER-Reviewing the records a company used to produce the financial
statements-- required for all public corporations in Canada whose shares are traded in a public stock
exchange
Independant Audits - ANSWER-Evaluation and unbiased opinion about the accuracy of a company's
financial statements
Public Accountant - ANSWER-Provides services to individuals or businesses on a fee basis i.e. compliance
or consulting
Bookkeeping - ANSWER-Recording business transactions (focus on inputs)
Accounting - ANSWER-Classifying and summarizing financial data recorded by bookkeepers (focus on
outputs)
Double Entry - ANSWER-Every transaction affects at least 2 accounts
Fundamental Accounting Equation - ANSWER-Assets = Liabilities + Owner's Equity
Ledger - ANSWER-A specialized accounting book in which information from accounting journals is
accumulated into accounts and posted so that managers can find all of the information about a specific
account in one place.
Trial Balance - ANSWER-A summary of all of the data in the account ledgers to show whether the figures
are correct and balanced
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