lOMoARcPSD|16785458

Fabm week 20 ama oed leaks

Cost Accounting (AMA Computer University)

StuDocu is not sponsored or endorsed by any college or university

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)
 lOMoARcPSD|16785458

Which of the following groups use financial accounting?

The correct answer is: All of the answers correct

Information is material if:

The correct answer is: Its omission or misstatement could influence the economic decisions of users
taken on the basis of the financial statements.

Insurance for the next year was paid in advance in cash, is the double entry bookkeeping entry to the
cash account a debit or a credit?

The correct answer is: Credit

Information is cost effective when:

The correct answer is: The value of the information exceeds the cost of producing it.

Under the general rule, revenue is recognized when:

The correct answer is: The earning process is complete or virtually complete.

The basic function of financial accounting is to

The correct answer is: Interpret financial data

What are the accounting standards issued by the IASB called?

The correct answer is: International Financial Reporting Standards

The basic function of financial accounting is to

The correct answer is: Interpret financial data

Which of the following statements is incorrect?

The correct answer is: An asset does not always have physical attributes

Financially, shareholders are rewarded by

The correct answer is: Dividends

The accounting cycle begins by recording _____________ in the form of journal entries.

The correct answer is: Business Transactions

All of the following are characteristics of managerial accounting, except:

The correct answer is: Information must be developed in conformity with generally accepted accounting
principles or with income tax regulations.

Which is the last step of accounting as a process of information?

The correct answer is: Preparation of financial statement

A chart of accounts is limited to 50 accounts.

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)

 lOMoARcPSD|16785458

The correct answer is: False

In which journal are debit notes received from suppliers are entered?

The correct answer is: Purchases

The accounting elements in the Balance sheet include:

The correct answer is: Assets, liabilities and equity

Office equipment is purchased on account from a supplier, is the double entry to the equipment account
a debit or a credit?

The correct answer is: Debit

Although accounting information is used by a wide variety of external parties, financial reporting is
primarily directed toward the information needs of:

The correct answer is: Investors and creditors

When does an accountant record a transaction?

The correct answer is: If it is materialized by a concrete document

The basic purpose of accounting is to:

The correct answer is: Meet an organization's need for accounting information as efficiently as possible.

Accounting is the language of business.

The correct answer is: True

Which financial statement is used to show what the firm owns?

The correct answer is: Balance sheet

Financial statements are prepared:

The correct answer is: Primarily for the benefit of persons outside of the business organizations

Government agency gives a CPA certificate to an accountant after he passes a series of rigorous
examinations administered by the Board of Accountancy (BOA).

The correct answer is: PRC

Which is the last step of accounting as a process of information?

The correct answer is: Preparation of financial statement

Which of the following is more appropriate definition for Accountancy?

The correct answer is: Accountancy refers to the art of classifying the recorded transactions under their
respective accounts

Accounting aims to communicate financial information to investors only.

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)

 lOMoARcPSD|16785458

The correct answer is: False

Accounting involves communication.

The correct answer is: True

Probable future sacrifices of economic benefits arising from past transactions are known as:

The correct answer is: Liabilities

It is usually used in connection with activities and events that result to the inflow of assets and/or
outflow of liabilities.

The correct answer is: Income

Accounting deals with quantifiable information.

The correct answer is: True

Accounting provides information on

The correct answer is: All of the answers correct

Supplies are purchased for cash, is the double entry posting to the supplies on hand account a debit or
credit entry?

The correct answer is: Debit

The term book keeping and accountancy can be used interchangeably.

The correct answer is: True

Temporary accounts would include:

The correct answer is: Drawing, income and expenses

A one year reporting period that begins on January 1 ends on December 31 is:

The correct answer is: Calendar year reporting period

A loan can be described as a short-term loan of the period is:

The correct answer is: Less than 1 year

The payment of a liability is recorded by a debit to the liability account and a credit to the owner's capital
account.

The correct answer is: False

The assets that can be converted into cash within a short period (1 year or less) are known as

The correct answer is: Current assets

Generally, revenues is recognized:

The correct answer is: At the point of delivery of the goods to the customers.

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)

 lOMoARcPSD|16785458

Which of the following statements is false?

The correct answer is: Owner's equity can be bigger than the total assets.

The four principal qualitative characteristics of useful financial statements are:

The correct answer is: Understandability, relevance, reliability, comparability

Which financial statement displays the revenues and expenses of a company for a period of time?

The correct answer is: Income Statement

Probable future sacrifices of economic benefits arising from past transactions are known as:

The correct answer is: Liabilities

Person who manages all of a firm's accounting activities.

The correct answer is: Controller

Which of the following accounts is a non-current liability

The correct answer is: Bank loan

Which of the following statement is incorrect?

The correct answer is: The settlement of a liability requires cash payment.

Which of the following statements is?incorrect?

The correct answer is: The business enterprise must have ownership over the items reported as business
assets.

The difference between the debit and credit amounts in an account is the account balance.

The correct answer is: True

The type of accounting which reports on the performance of the firm to essential external users.

The correct answer is: Financial accounting

Which of the following is NOT considered revenue?

The correct answer is: Deferred Revenue

Which is NOT a type of adjusting entry?

The correct answer is: Unearned expenses

The long-term assets that have no physical existence but are right that have value is known as:

The correct answer is: Intangible assets

Which of the following is the reason why adjusting entries are prepared?

The correct answer is: Matching concept

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)

 lOMoARcPSD|16785458

Which of the following accounts is not liability?

The correct answer is: Prepaid insurance

The liabilities that are payable in more than a year and are not be liquidated from current assets.

The correct answer is: Fixed liabilities

All entries must be supported by a source document.

The correct answer is: True

Which of the following is not an acceptable basis of recognizing expenses?

The correct answer is: Critical measurement

Which of the following items may appear in a balance sheet?

The correct answer is: Capital, drawing, and net income

Which of the following is never debited when making closing entries?

The correct answer is: Expenses

Amount generated from sales in a business is called:

The correct answer is: Income

Debit and credit rules for accounts on one side of the accounting equation are mirror images of those on
the other side.

The correct answer is: True

A business transaction can affect two accounts on the same side of the accounting equation and still
leave the equation in balance.

The correct answer is: True

Arise from those ordinary activities that are directly related to the normal operations of the business.

The correct answer is: Revenues

Which of the following will not be reported in the statement of changes in equity?

The correct answer is: Proceeds from the sale of the building

Work was completed and invoiced to a customer for payment within 30 days, is the posting to accounts
receivable a debit or a credit?

The correct answer is: Debit

Permanent accounts would include:

The correct answer is: Assets, liabilities and equity

Which is the last step of accounting as a process of information?

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)

 lOMoARcPSD|16785458

The correct answer is: Preparation of financial statement

Which of the following accounts is not an asset?

The correct answer is: Unearned commission

All of the following are cash and cash equivalents, EXCEPT

The correct answer is: Money market replacement

Which of the following transactions would increase Cash and cash equivalents and increase Non-current
liabilities?

The correct answer is: Bank loan

Every transaction affects two or more accounts and is recorded by equal amounts of debits and credits.

The correct answer is: True

The net income of a reporting period is equal to:

The correct answer is: Income - expenses

Downloaded by Criscel Santiago (iscelsantiago15@gmail.com)