Exam (elaborations)
Business Accounting Exam 1 Questions and Answers
- Course
- Accounting
- Institution
- Accounting
Business Accounting Exam 1 Questions and Answers
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Business Accounting Exam 1 Questionsand Answers
What is the role of accounting is business? - Answer-Identifying, recording and
communicate
Who are the main two types of users of accounting information - Answer-External and
Internal Users
external users type of accounting information - Answer-financial accounting which
provides external users with financial statements
Internal users type of accounting information - Answer-Managerial accounting which
provides information needs for internal decision-makers
What is business fraud? - Answer-Business fraud is a lack of ethics which is a failure of
individual character.
A. What is Sarbanes-Oxley and how does it affect management? - Answer-Is a law
placed with the purpose of restoring the publics confidence and trust in the financial
statements of a company.
What is GAAP - Answer-Generally Accepted Accounting Principles
? What are the 3 criteria for all accounting information created by GAAP? - Answer-The
three criteria are relevant information, reliable information and comparable information.
Principles and Assumptions of Accounting - Answer-Measurement (cost) principle
Revenue Recognition Principle
Matching principle
Full Disclosure Principle
Going-concern assumption
Monetary Unit assumption
Time-period assumption
Business entity assumption
Measurement/Cost Principle - Answer-Objective evidence must be used (not opinion)
cost is market driven.
Revenue Recognition Principle - Answer-Record revenue when goods or services are
provided to customer at the amount expected to be received.
Matching Principle - Answer-See what expenses incurred to generate that revenue and
record that as well.
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