Exam (elaborations)
BOMI- Budgeting And Accounting: Questions/Answers
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BOMI- Budgeting And Accounting: Questions/Answers
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BOMI- Budgeting And Accounting: Questions/AnswersWhich key components make up the bookkeeping process? (2) Right Ans -
recording and classifying transactions is known as bookkeeping.
Describe the roles filled by a accountant (3) Right Ans - Accounting is a
system of summarizing, interpreting, and communicating financial data.
What are the primary functions associated with accounting ? (4) Right Ans
- Accounting is the next step in the process. Accounting is the system of
summarizing, interpreting, and communicating financial data.
Specify functions incorporated in the budgeting process. (4) Right Ans -
Budgeting is the ongoing process of coordinating resources and expenditures.
Through this process, a plan is created with research and data as the
foundation.
The budget reflects the priorities of the business and the resources needed to
accomplish them. Right Ans -
Describe the accounting cycle types most common to commercial real estate
management business (5) Right Ans - revenue cycle and the expenditure
cycle
What are the three summary account types ? (9) Right Ans - assets,
liabilities, and owner's equity—with each other as they increase and decrease
with debits and credits.
On the balance sheet, assets, liabilities, and owner's equity show the current
status of the finances of the business or the building. Right Ans -
How are debits and credits applied to fundamental accounting equation ? (11-
12) Right Ans - liabilities and owner's equity normally have a credit
balance
a credit entry will increase the liability or owner's equity and a debit entry
will decrease the liability or owner's equity
,assets -normally have a debit balance, a debit entry will increase the value of
an asset, a credit entry will decrease the value of an asset Right Ans -
explain the relationship between the balance sheets and summary accounts
(15) Right Ans - The balance sheet is literally a statement of the balances,
or amounts, within all of the assets, liabilities, and owner's equity summary
accounts of the business.
what are the generally accepted accounting principles ? (GAAP) (19) Right
Ans - Generally accepted accounting principles (GAAP) are a common set of
accounting principles, standards, and procedures that companies use to
record accounting data and compile their financial statements.
GAAP is a combination of authoritative standards (set by policy boards), as
well as commonly accepted ways of recording and reporting accounting
information. Right Ans - These standards are codified by the Financial
Accounting Standards Board (FASB).
What are international accounting standards ?(19) Right Ans - Standards
established and maintained by the International Accounting Standards Board,
that are used by multi national companies
What are internal reporting needs common to the real property industry?(20)
Right Ans - property industry internal reporting includes , tenant collections,
vendor payments, and monthly operating results.
Describe standard financial statements that businesses use? (20) Right Ans
- These financial statements consist of an income statements, a balance sheet,
and a statement of cash flows.The income statement shows revenues earned
and expenses incurred in earning those revenues, resulting in net income or
net loss for the period.
What are common accounting methods used for recording financial
transactions ? (21) Right Ans - Accounting and financial reports can be
prepared on a cash, accrual, or modified accrual (also known as hybrid)
accounting basis.
When the cash method is used, income and expenses are recorded only when
they are received or paid out. This form of accounting is the most basic and
,has a cote focus on the actual timing of both cash received and cash dispersed.
Right Ans -
Explain accounting control strategies as they are used in real estate. (22)
Right Ans - control strategies place to detect fraud or theft but are primarily
put in place to avoid human error. strategies to avoid missed cash collection,
or conversely excessive outflows that deplete an owners cash. These include,
collections, costs controls
Scenario - Chapter 1. Harold, an experienced finances manager for Beach
Properties, hired Janet and is reviewing the various aspects of budgeting and
accounting that she will need to understand and perform. Right Ans -
Although she majored in finance at the local college, she lacks real world
experience. As Harold works with her over the next few weeks, he will seek to
gauge her level of understanding of budgeting and accounting fundamentals.
He will also have her perform some basic tasks. To the degree that she
succeeds, she will move on to more important and complicated projects. To
the degree that she fails, Harold will provide additional training and support.
Right Ans -
"Janet, your main job function for the next few months will be to record and
classify transactions" says Harold. "In other words, you will be performing the
process of..Blank..
a. accounting b. bookkeeping
c. budgeting d. financing Right Ans - b. bookkeeping
To the degree you are able to assume the role of accountant, Harold informs
Janet, you'll engage in many more functions. However you will not be
responsible for ....Blank ... Financial data Right Ans - B. memorizing
If Janet performs an accounting function, she will.. blank...financial data.
a. classify
b. identify
c. interpret
d. record Right Ans - c. interpret
remember Janet, that when we create our budget, we make a plan for the
financing expenditures in the ...Blank..., says Harold Right Ans - d. next year
, At lunch, Janet tells a friend that some of the job functions she will be
performing include acquiring property, paying for it, and reporting on what is
acquired and paid for. "Oh," her friend correctly notes, "then you'll be involved
in the....BLANK..cycle of accounting."
a. asset
b. control
c. revenue
d. expenditure Right Ans - d. expenditure
When Janet "balances the books" (or the summary accounts), she will
basically be dealing with:
a. assets, liabilities, and owner's equity.
b. tax planning, revenues, and liabilities.
c. liabilities, budgets, and owner's equity.
d. owner's equity, capital, and tax planning. Right Ans - a. assets, liabilities,
and owner's equity
Janet," asks Harold, "if the company takes out a loan to make capital
purchases, how would you record this?" To be correct, Janet should record the
money received as a________in Assets and as a__ in Liabilities.
a. debit; debit
b. debit; credit
c. credit; debit
d. credit; credit Right Ans - b. debit; credit
Day after day, Janet records debits and credits for each entry to the balance
sheet. This pro-
cess is referred to as accounting.
a. single-pass
b. double-pass
c. single-entry
d. double-entry Right Ans - d. double-entry
The common set of accounting principles, standards, and procedures that
Janet uses to record accounting data and compile the company's financial
statements is known as:
a. ASC.
b. GAAP.
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