Question 1

Financial accounting: please select all that apply.

Accepted Answer

A)  Reports on past events. 
B)  Focuses on the costs of products and services. 
C)  Is used to plan levels of production and activity. 
D)  Reports to users outside the organisation. 
A)  Reports on past events. 
B)  Focuses on the costs of products and services. 
C)  Is used to plan levels of production and activity. 
D)  Reports to users outside the organisation. A,D

Question 2

Which of the following statements are true? Please select all that apply.

Accepted Answer

A)  Accounting data is presented in the form of numbers. 
B)  To be relevant, financial information must be capable of making a difference in the decisions made by users. 
C)  Accounting provides measures with which to assess the quality of an organization's performance. 
D)  Stewards are entrusted with and look after resources for the benefit of other parties. 
A)  Accounting data is presented in the form of numbers. 
B)  To be relevant, financial information must be capable of making a difference in the decisions made by users. 
C)  Accounting provides measures with which to assess the quality of an organization's performance. 
D)  Stewards are entrusted with and look after resources for the benefit of other parties. A,B,D

Question 3

Which one of the following statements is not a description of the fundamental qualitative characteristic of faithful representation?

Accepted Answer

A)  Information presented must not only represent relevant economic phenomena (transactions and events), but it must also faithfully represent the phenomena that it purports to represent. 
B)  Information presented should be verifiable. 
C)  Information presented should be complete, neutral and free from error. 
D)  Information presented does not have to be perfectly accurate in order to provide a faithful representation. 
A)  Information presented must not only represent relevant economic phenomena (transactions and events), but it must also faithfully represent the phenomena that it purports to represent. 
B)  Information presented should be verifiable. 
C)  Information presented should be complete, neutral and free from error. 
D)  Information presented does not have to be perfectly accurate in order to provide a faithful representation. B

Question 4

Which one of the following statements does not describe accountability?

Accepted Answer

A)  Accounting information reporting on past actions is a stewardship report. 
B)  Accounting information reporting on the current cost and selling prices of products. 
C)  Representatives reporting on their actions to those people who have placed them in positions of power. 
D)  Accounting information provided so that individuals and organisations can render an account of what they have done with resources entrusted to them. 
A)  Accounting information reporting on past actions is a stewardship report. 
B)  Accounting information reporting on the current cost and selling prices of products. 
C)  Representatives reporting on their actions to those people who have placed them in positions of power. 
D)  Accounting information provided so that individuals and organisations can render an account of what they have done with resources entrusted to them.

Question 5

Financial accounting is:

Accepted Answer

A)  The reporting of past information to users within the organisation. 
B)  The reporting of present and future information to users within the organisation. 
C)  The reporting of present and future information to users outside the organisation. 
D)  The reporting of past information to users outside the organisation. 
A)  The reporting of past information to users within the organisation. 
B)  The reporting of present and future information to users within the organisation. 
C)  The reporting of present and future information to users outside the organisation. 
D)  The reporting of past information to users outside the organisation.

Question 6

Which one of the following statements does not describe verifiability?

Accepted Answer

A)  Verifiability provides users with assurance that information is faithfully presented and reports the economic phenomena it purports to represent. 
B)  Verifiable iinformation is complete, neutral and free from error. 
C)  The accuracy of information can be verified by observation or re-calculation. 
D)  External auditors will undertake testing to prove to themselves that the information presented is accurate in all major respects. 
A)  Verifiability provides users with assurance that information is faithfully presented and reports the economic phenomena it purports to represent. 
B)  Verifiable iinformation is complete, neutral and free from error. 
C)  The accuracy of information can be verified by observation or re-calculation. 
D)  External auditors will undertake testing to prove to themselves that the information presented is accurate in all major respects.

Question 7

Which one of the following statements is not true?

Accepted Answer

A)  Information should only be presented if the costs of obtaining that information exceed the benefits of providing it. 
B)  Information is material if omitting it or misstating it could influence decisions that…users…make on the basis of…financial information about a specific reporting entity. 
C)  To help users understand information presented, that information should be classified, characterized and presented clearly. 
D)  Where information is not comparable, similarities and differences will not be readily apparent. 
A)  Information should only be presented if the costs of obtaining that information exceed the benefits of providing it. 
B)  Information is material if omitting it or misstating it could influence decisions that…users…make on the basis of…financial information about a specific reporting entity. 
C)  To help users understand information presented, that information should be classified, characterized and presented clearly. 
D)  Where information is not comparable, similarities and differences will not be readily apparent.

Question 8

The characteristics of materiality and comparability are both entity-specific.

Accepted Answer

A) True 
 B)False

Question 9

Perfectly faithful representation of economic phenomena in words and numbers requires that the information presented must be:
Please select all that apply.

Accepted Answer

A)  Free from error 
B)  Neutral 
C)  Timely 
D)  Complete 
A)  Free from error 
B)  Neutral 
C)  Timely 
D)  Complete

Question 10

Comparability requires that:
Please select all that apply.

Accepted Answer

A)  Information should be comparable over time. 
B)  Information should be comparable with similar information about other entities for the same reporting period and with similar information about the same entity for other reporting periods in order to enhance its usefulness. 
C)  Information should be presented consistently. 
D)  Information about economic phenomena should be presented in a uniform way. 
A)  Information should be comparable over time. 
B)  Information should be comparable with similar information about other entities for the same reporting period and with similar information about the same entity for other reporting periods in order to enhance its usefulness. 
C)  Information should be presented consistently. 
D)  Information about economic phenomena should be presented in a uniform way.

Question 11

Details of the length of time it takes an organisation to pay for goods purchased on credit terms would be of most interest to which user group?

Accepted Answer

A)  Customers 
B)  Employees 
C)  Shareholders 
D)  Suppliers 
A)  Customers 
B)  Employees 
C)  Shareholders 
D)  Suppliers

Question 12

Which one of the following is not a description of the fundamental qualitative characteristic of relevance?

Accepted Answer

A)  Information that may assist users to assess the accuracy of past predictions. 
B)  Information that is capable of making a difference in the decisions made by users. 
C)  Information that may be predictive. 
D)  Information that must be verifiable. 
A)  Information that may assist users to assess the accuracy of past predictions. 
B)  Information that is capable of making a difference in the decisions made by users. 
C)  Information that may be predictive. 
D)  Information that must be verifiable.

Question 13

Which one of the following statements most accurately describes the fundamental qualitative characteristic of relevance?

Accepted Answer

A)  Information that not only represents relevant economic phenomena but also faithfully represents the phenomena that it purports to represent. 
B)  Information that is comparable over time. 
C)  Information that is capable of making a difference in the decisions made by users. 
D)  Information that is available to users in time for it to be capable of influencing their decisions. 
A)  Information that not only represents relevant economic phenomena but also faithfully represents the phenomena that it purports to represent. 
B)  Information that is comparable over time. 
C)  Information that is capable of making a difference in the decisions made by users. 
D)  Information that is available to users in time for it to be capable of influencing their decisions.

Question 14

Cost and management accounting: please select all that apply.

Accepted Answer

A)  Focuses on the present and future. 
B)  Presents information to users outside the organisation. 
C)  Helps managers to decide which products to produce and sell. 
D)  Uses reports on the results of past plans to improve operations in the future.
Topic: Users of financial statements 
A)  Focuses on the present and future. 
B)  Presents information to users outside the organisation. 
C)  Helps managers to decide which products to produce and sell. 
D)  Uses reports on the results of past plans to improve operations in the future.
Topic: Users of financial statements

Question 15

Which one of the following statements is not correct?

Accepted Answer

A)  The more accurate past predictions of profits have been, the less likely it is that users will be able to rely on current predictions of future profits. 
B)  All users of accounting information will be interested in the cash generating capabilities of an entity 
C)  Financial information must not only represent relevant economic phenomena (transactions and events), but it must also faithfully represent the phenomena that it purports to represent. 
D)  Accounting information provides a mechanism through which to control outcomes and activities. 
A)  The more accurate past predictions of profits have been, the less likely it is that users will be able to rely on current predictions of future profits. 
B)  All users of accounting information will be interested in the cash generating capabilities of an entity 
C)  Financial information must not only represent relevant economic phenomena (transactions and events), but it must also faithfully represent the phenomena that it purports to represent. 
D)  Accounting information provides a mechanism through which to control outcomes and activities.

Question 16

Which one of the following statements is not correct?

Accepted Answer

A)  The objective of general financial reporting is to provide financial information about the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources to the entity. 
B)  While financial accounting presents information about what has happened in the past, cost and management accounting is very much concerned with both the present and the future and how accounting information can be used for short-term decision making and longer-term planning. 
C)  Understandability assumes that readers of financial reports have a reasonable knowledge of business and economic activities in order to make sense of what they are presented with. 
D)  Accounting summarizes narrative data relating to past events and presents this data as information to managers and other interested parties as a basis for both decision making and control purposes. 
A)  The objective of general financial reporting is to provide financial information about the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources to the entity. 
B)  While financial accounting presents information about what has happened in the past, cost and management accounting is very much concerned with both the present and the future and how accounting information can be used for short-term decision making and longer-term planning. 
C)  Understandability assumes that readers of financial reports have a reasonable knowledge of business and economic activities in order to make sense of what they are presented with. 
D)  Accounting summarizes narrative data relating to past events and presents this data as information to managers and other interested parties as a basis for both decision making and control purposes.

Question 17

A lender using a set of published financial statements would be most interested in:

Accepted Answer

A)  The entity's ability to generate cash from which to pay interest. 
B)  The entity's ability to generate cash from which to pay dividends. 
C)  The entity's ability to generate cash from which to pay bonuses. 
D)  The entity's ability to generate cash from which to pay taxation due on profits. 
A)  The entity's ability to generate cash from which to pay interest. 
B)  The entity's ability to generate cash from which to pay dividends. 
C)  The entity's ability to generate cash from which to pay bonuses. 
D)  The entity's ability to generate cash from which to pay taxation due on profits.

Question 18

Which one of the following statements does not describe cost and management accounting?

Accepted Answer

A)  Cost and management accounting information is concerned with reporting outcomes of past events to users external to the organisation. 
B)  Cost and management accounting is concerned with reporting accounting and cost information to users within an organisation. 
C)  Cost and management accounting information is used to plan levels of production and activity in the future. 
D)  Cost and management accounting information is mostly concerned with the present and the future. 
A)  Cost and management accounting information is concerned with reporting outcomes of past events to users external to the organisation. 
B)  Cost and management accounting is concerned with reporting accounting and cost information to users within an organisation. 
C)  Cost and management accounting information is used to plan levels of production and activity in the future. 
D)  Cost and management accounting information is mostly concerned with the present and the future.

Question 19

Information whose omission or misstatement could influence decisions that users make on the basis of financial information about a specific reporting entity defines which characteristic of accounting information?

Accepted Answer

A)  Comparability 
B)  Verifiability 
C)  Cost-benefit 
D)  Materiality 
A)  Comparability 
B)  Verifiability 
C)  Cost-benefit 
D)  Materiality

Question 20

Which one of the following is not a limitation of accounting information?

Accepted Answer

A)  Accounting information does not value the external effects of operations on the environment. 
B)  Accounting information does not value the skills and knowledge base of an entity. 
C)  Accounting information does not consider the quality of performance. 
D)  Accounting information does not include information whose costs outweigh the benefit of providing it. 
A)  Accounting information does not value the external effects of operations on the environment. 
B)  Accounting information does not value the skills and knowledge base of an entity. 
C)  Accounting information does not consider the quality of performance. 
D)  Accounting information does not include information whose costs outweigh the benefit of providing it.

Financial accounting: please select all that apply.

Which of the following statements are true? Please select all that apply.

Which one of the following statements is not a description of the fundamental qualitative characteristic of faithful representation?

Which one of the following statements does not describe accountability?

Financial accounting is:

Which one of the following statements does not describe verifiability?

Which one of the following statements is not true?

The characteristics of materiality and comparability are both entity-specific.

Perfectly faithful representation of economic phenomena in words and numbers requires that the information presented must be: Please select all that apply.

Comparability requires that: Please select all that apply.

Details of the length of time it takes an organisation to pay for goods purchased on credit terms would be of most interest to which user group?

Which one of the following is not a description of the fundamental qualitative characteristic of relevance?

Which one of the following statements most accurately describes the fundamental qualitative characteristic of relevance?

Cost and management accounting: please select all that apply.

Which one of the following statements is not correct?

Which one of the following statements is not correct?

A lender using a set of published financial statements would be most interested in:

Which one of the following statements does not describe cost and management accounting?

Information whose omission or misstatement could influence decisions that users make on the basis of financial information about a specific reporting entity defines which characteristic of accounting information?

Which one of the following is not a limitation of accounting information?

The Statement of Financial Position

The Income Statement

The Statement of Cash Flows

Business Organisations and the Financing of Business

Ratio Analysis 1: Profitability, Efficiency, and Performance

Ratio Analysis 2: Liquidity, Working Capital and Long-Term Financial Stability

Costing

Relevant Costs, Marginal Costing and Decision Making

Standard Costing and Variance Analysis

Budgeting

Capital Investment Appraisal

Filters

Exam 1: Introduction to Accounting

Financial accounting: please select all that apply.

Which of the following statements are true? Please select all that apply.

Which one of the following statements is not a description of the fundamental qualitative characteristic of faithful representation?

Which one of the following statements does not describe accountability?

Financial accounting is:

Which one of the following statements does not describe verifiability?

Which one of the following statements is not true?

The characteristics of materiality and comparability are both entity-specific.

Perfectly faithful representation of economic phenomena in words and numbers requires that the information presented must be: Please select all that apply.

Comparability requires that: Please select all that apply.

Details of the length of time it takes an organisation to pay for goods purchased on credit terms would be of most interest to which user group?

Which one of the following is not a description of the fundamental qualitative characteristic of relevance?

Which one of the following statements most accurately describes the fundamental qualitative characteristic of relevance?

Cost and management accounting: please select all that apply.

Which one of the following statements is not correct?

Which one of the following statements is not correct?

A lender using a set of published financial statements would be most interested in:

Which one of the following statements does not describe cost and management accounting?

Information whose omission or misstatement could influence decisions that users make on the basis of financial information about a specific reporting entity defines which characteristic of accounting information?

Which one of the following is not a limitation of accounting information?

The Statement of Financial Position

The Income Statement

The Statement of Cash Flows

Business Organisations and the Financing of Business

Ratio Analysis 1: Profitability, Efficiency, and Performance

Ratio Analysis 2: Liquidity, Working Capital and Long-Term Financial Stability

Costing

Relevant Costs, Marginal Costing and Decision Making

Standard Costing and Variance Analysis

Budgeting

Capital Investment Appraisal

Filters