Question 1

Calculate the cash available at the end of the day if cash at the beginning is $450, receipts from customers are $600 and payments to suppliers are $350.

Accepted Answer

A)  $200 
B)  $750 
C)  $1,400 
D)  $700 
A)  $200 
B)  $750 
C)  $1,400 
D)  $700

Question 2

Tom owns an antique writing desk he paid $500 for 6 years ago that he is now considering selling. A local antique dealer gives Tom an estimated market valuation for the desk. In relation to the decision to sell the desk, the market value, in comparison to the original purchase value, is:

Accepted Answer

A)  relevant. 
B)  relevant and reliable. 
C)  reliable. 
D)  none of the above. 
A)  relevant. 
B)  relevant and reliable. 
C)  reliable. 
D)  none of the above.

Question 3

The set of financial reports made available for external publication by an entity is typically produced:

Accepted Answer

A)  daily. 
B)  yearly. 
C)  fortnightly. 
D)  weekly. 
A)  daily. 
B)  yearly. 
C)  fortnightly. 
D)  weekly.

Question 4

The group of users that is most likely to require accounting information to assess the ability of a business to pay interest and repay a loan is:

Accepted Answer

A)  lenders. 
B)  taxation department. 
C)  customers. 
D)  employees. 
A)  lenders. 
B)  taxation department. 
C)  customers. 
D)  employees.

Question 5

Which of these is not one of the key qualitative characteristics of accounting information?

Accepted Answer

A)  control 
B)  comparability 
C)  relevance 
D)  cost versus benefit 
A)  control 
B)  comparability 
C)  relevance 
D)  cost versus benefit

Question 6

Which of these is not generally regarded as a reason for the recent spate of dubious accounting practices by large companies?

Accepted Answer

A)  Lack of accounting standards. 
B)  Pressure on managers to meet investors' unrealistic expectations for continually rising profits. 
C)  Greed by executives. 
D)  Too rapid growth financed by borrowing which leads to a liquidity crisis. 
A)  Lack of accounting standards. 
B)  Pressure on managers to meet investors' unrealistic expectations for continually rising profits. 
C)  Greed by executives. 
D)  Too rapid growth financed by borrowing which leads to a liquidity crisis.

Question 7

The objective of business to maximise economic growth within the bounds of minimising impacts on the environment is known as:

Accepted Answer

A)  wealth maximisation. 
B)  growth. 
C)  satisficing. 
D)  sustainable development. 
A)  wealth maximisation. 
B)  growth. 
C)  satisficing. 
D)  sustainable development.

Question 8

The statement of changes in owners' equity:

Accepted Answer

A)  links the income statement and the balance sheet. 
B)  links the cash flow statement and the income statement. 
C)  links the balance sheet at the beginning of the period with the balance sheet at the end of the period. 
D)  A and C 
A)  links the income statement and the balance sheet. 
B)  links the cash flow statement and the income statement. 
C)  links the balance sheet at the beginning of the period with the balance sheet at the end of the period. 
D)  A and C

Question 9

The best explanation of relevance is:

Accepted Answer

A)  ensuring that information is useful for decision-making. 
B)  ensuring that the benefit of the information is greater than the cost of providing it. 
C)  ensuring that information is expressed as clearly as possible. 
D)  ensuring that information is free from bias. 
A)  ensuring that information is useful for decision-making. 
B)  ensuring that the benefit of the information is greater than the cost of providing it. 
C)  ensuring that information is expressed as clearly as possible. 
D)  ensuring that information is free from bias.

Question 10

The most complete description of the planning process for a business is:

Accepted Answer

A)  setting objectives, long-term plans and short-term plans. 
B)  setting objectives and short-term plans. 
C)  setting objectives and detailed budgets. 
D)  setting long-term objectives and long-term plans. 
A)  setting objectives, long-term plans and short-term plans. 
B)  setting objectives and short-term plans. 
C)  setting objectives and detailed budgets. 
D)  setting long-term objectives and long-term plans.

Question 11

Businesses tend to resist providing forecast data to those outside the organisation mainly because:

Accepted Answer

A)  it is too difficult. 
B)  it is too costly. 
C)  the data is inaccurate. 
D)  of fear of the loss of competitive advantage. 
A)  it is too difficult. 
B)  it is too costly. 
C)  the data is inaccurate. 
D)  of fear of the loss of competitive advantage.

Question 12

Management reports, compared with financial reports, are:

Accepted Answer

A)  summarised. 
B)  detailed. 
C)  standardised. 
D)  aggregated. 
A)  summarised. 
B)  detailed. 
C)  standardised. 
D)  aggregated.

Question 13

The test to determine whether an item of accounting information is worthwhile collecting is:

Accepted Answer

A)  cost test. 
B)  validation test. 
C)  cost-benefit test. 
D)  worthwhile test. 
A)  cost test. 
B)  validation test. 
C)  cost-benefit test. 
D)  worthwhile test.

Question 14

Four key qualitative characteristics of accounting information are:

Accepted Answer

A)  control, planning, analysis, and comparability. 
B)  understandability, identification, analysis, and relevance. 
C)  relevance, faithful representation, comparability, and understandability. 
D)  identification, analysis, faithful representation, and timeliness. 
A)  control, planning, analysis, and comparability. 
B)  understandability, identification, analysis, and relevance. 
C)  relevance, faithful representation, comparability, and understandability. 
D)  identification, analysis, faithful representation, and timeliness.

Question 15

The term that describes differences between actual and budgeted results is:

Accepted Answer

A)  mistake. 
B)  variance. 
C)  divergence. 
D)  discrepancy. 
A)  mistake. 
B)  variance. 
C)  divergence. 
D)  discrepancy.

Question 16

The financial reports comprising the 'final reports' are the:

Accepted Answer

A)  cash flow statement, income statement. 
B)  income statement, balance sheet, cash flow statement, statement of change in owners' equity. 
C)  balance sheet, cash flow statement, income statement. 
D)  income statement and balance sheet. 
A)  cash flow statement, income statement. 
B)  income statement, balance sheet, cash flow statement, statement of change in owners' equity. 
C)  balance sheet, cash flow statement, income statement. 
D)  income statement and balance sheet.

Question 17

Control is best defined as:

Accepted Answer

A)  making the directors perform according to plan. 
B)  giving orders. 
C)  making events conform to plan. 
D)  making the employees work harder. 
A)  making the directors perform according to plan. 
B)  giving orders. 
C)  making events conform to plan. 
D)  making the employees work harder.

Question 18

Which accounting report is specifically designed to answer the question 'What profit was earned in a particular period?'

Accepted Answer

A)  cash flow statement 
B)  balance sheet 
C)  income statement 
D)  all of the above 
A)  cash flow statement 
B)  balance sheet 
C)  income statement 
D)  all of the above

Question 19

The best description of the primary purposes of providing accounting information is:

Accepted Answer

A)  to calculate the bank account balance. 
B)  to enable the financial statements to be prepared. 
C)  to allow the preparation of a taxation return. 
D)  to assist users in making informed decisions. 
A)  to calculate the bank account balance. 
B)  to enable the financial statements to be prepared. 
C)  to allow the preparation of a taxation return. 
D)  to assist users in making informed decisions.

Calculate the cash available at the end of the day if cash at the beginning is $450, receipts from customers are $600 and payments to suppliers are $350.

Tom owns an antique writing desk he paid $500 for 6 years ago that he is now considering selling. A local antique dealer gives Tom an estimated market valuation for the desk. In relation to the decision to sell the desk, the market value, in comparison to the original purchase value, is:

The set of financial reports made available for external publication by an entity is typically produced:

The group of users that is most likely to require accounting information to assess the ability of a business to pay interest and repay a loan is:

Which of these is not one of the key qualitative characteristics of accounting information?

Which of these is not generally regarded as a reason for the recent spate of dubious accounting practices by large companies?

The objective of business to maximise economic growth within the bounds of minimising impacts on the environment is known as:

The statement of changes in owners' equity:

The best explanation of relevance is:

The most complete description of the planning process for a business is:

Businesses tend to resist providing forecast data to those outside the organisation mainly because:

Management reports, compared with financial reports, are:

The test to determine whether an item of accounting information is worthwhile collecting is:

Four key qualitative characteristics of accounting information are:

The term that describes differences between actual and budgeted results is:

The financial reports comprising the 'final reports' are the:

Control is best defined as:

Which accounting report is specifically designed to answer the question 'What profit was earned in a particular period?'

The best description of the primary purposes of providing accounting information is:

Different Accounting Entities

Measuring and Reporting Financial Position

Measuring and Reporting Financial Performance

Measuring and Reporting Cash Flows

Analysis and Interpretation of Financial Statements

Costvolumeprofit Analysis and Marginal Analysis

Full Costing

Budgeting

Projected Financial Statements

Capital Investment Decisions

The Management of Working Capital

Financing the Business

Trends and Issues in Accounting

Filters

Exam 1: Introduction to Accounting

Calculate the cash available at the end of the day if cash at the beginning is $450, receipts from customers are $600 and payments to suppliers are $350.

Tom owns an antique writing desk he paid $500 for 6 years ago that he is now considering selling. A local antique dealer gives Tom an estimated market valuation for the desk. In relation to the decision to sell the desk, the market value, in comparison to the original purchase value, is:

The set of financial reports made available for external publication by an entity is typically produced:

The group of users that is most likely to require accounting information to assess the ability of a business to pay interest and repay a loan is:

Which of these is not one of the key qualitative characteristics of accounting information?

Which of these is not generally regarded as a reason for the recent spate of dubious accounting practices by large companies?

The objective of business to maximise economic growth within the bounds of minimising impacts on the environment is known as:

The statement of changes in owners' equity:

The best explanation of relevance is:

The most complete description of the planning process for a business is:

Businesses tend to resist providing forecast data to those outside the organisation mainly because:

Management reports, compared with financial reports, are:

The test to determine whether an item of accounting information is worthwhile collecting is:

Four key qualitative characteristics of accounting information are:

The term that describes differences between actual and budgeted results is:

The financial reports comprising the 'final reports' are the:

Control is best defined as:

Which accounting report is specifically designed to answer the question 'What profit was earned in a particular period?'

The best description of the primary purposes of providing accounting information is:

Different Accounting Entities

Measuring and Reporting Financial Position

Measuring and Reporting Financial Performance

Measuring and Reporting Cash Flows

Analysis and Interpretation of Financial Statements

Costvolumeprofit Analysis and Marginal Analysis

Full Costing

Budgeting

Projected Financial Statements

Capital Investment Decisions

The Management of Working Capital

Financing the Business

Trends and Issues in Accounting

Filters