Fundamentals of Accounting Study Guide Exam And Actual Answers.
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Course
Fundamentals of Accounting
Institution
Fundamentals Of Accounting
Define financial accounting. - Answer It is the recording of financial information within an organization, which gives information to investors to help in their investing decisions.
What decision does financial accounting help with? - Answer The decision about the amount of investment to be ...
Fundamentals of Accounting Study
Guide Exam And Actual Answers.
Define financial accounting. - Answer It is the recording of financial information within an organization,
which gives information to investors to help in their investing decisions.
What decision does financial accounting help with? - Answer The decision about the amount of
investment to be made in the shares of a company by investors
What is the aim of reports prepared by financial accounting? - Answer Financial accounting reports
enable individuals to make informed decisions about the future prospects of a company.
__________ helps individuals in making informed decisions about businesses and other organizations. -
Answer Financial accounting
What is a key feature of a corporation? - Answer A corporation can sell ownership shares to raise
money for capital expenditures and operations.
___________ can obtain monetary resources by selling capital shares allowing the investors to become
owners. - Answer Corporations
What is a feature of capital and operational structure of a corporation? - Answer Each capital share of
the capital structure of a corporation is equivalent to one unit of ownership.
Who elects the board of directors of a corporation? - Answer Shareholders
What is the process of accounting? - Answer Org calculates/analyzes financial info -> Org reports info ->
internal/external parties assess health and future prospects
What is the accounting equation? - Answer Assets = Liabilities + Equity
, ________________ refers to the communication of information within an organization so that internal
decisions (such as whether to buy or rent a building) can be made in an appropriate manner. - Answer
Managerial accounting
What is true of an asset? - Answer The acquisition of an asset results in probable future economic
benefit.
_________ is a probable future sacrifice of economic benefits arising from present obligations. - Answer
Liability
How are net assets computed? - Answer Net assets are computed by deducting liabilities from total
assets.
What does revenue measure? - Answer Revenue measures an increase in net assets created by the sale
of inventory and services.
Assume Twicee Inc. assembles access control systems costing $210 each, packages them at a cost of $20,
and sells them for $275. Calculate the amount of revenue per unit generated. - Answer 275
What can be inferred if there is an increase in assets resulting from the sale of inventory? - Answer An
increase in assets from the sale of inventory results in an equal increase in the value of net assets.
It is the communication of financial information to investors by a business to help them make investment
decisions. This is true of _________. - Answer Financial accounting
How do financial statements help investors in decision making? - Answer Financial statement helps
investors make the final investment decision in the shares of the company.
_____________ communicates the relevant financial information about an organization by following
accepted accounting standards and methods. - Answer Financial accounting
_________ is a separate legal entity from its owners. - Answer Corporation
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