Chapter 1 (“Accounting: The Language of Business”)

Question 1

separate entity assumption

Answer 1

Concept of keeping a firm’s financial records separate from the owner’s personal financial records.

Question 2

The Financial Accounting Standards Board is responsible for:

Answer 2

developing generally accepted accounting principles.

Question 3

The purpose of accounting is to provide financial information about an economic or social entity.

True/False

Answer 3

True

Question 4

The SEC uses financial information to determine a company’s tax base.

True/False

Answer 4

False

Question 5

LLP

Answer 5

Limited liability partnership.

A form of the partnerships business entity.