CHAPTER 1 POA

Question 1

Name the features of sole proprietorship

Answer 1

1. the sole proprietor is the only owner of the business.
2. the sole proprietor has full control over the management of the business.

Question 2

2. Name the stakeholders and their features

Answer 2

1. employee: whether to continue working at the business or not.
2. managers: whether to consider ways on how to improve the business.
3. customers: whether to continue buying from the business depending on the businesses ability to provide them with the goods and services that they need.

Question 3

What is the role of accounting?

Answer 3

accounting is an information system that provides accounting information for stakeholders to make informed decisions regarding the management of resources and performance of the business.

Question 4

What are the role of accountants?

Answer 4

1. accountants set up an accounting information system.
2. become stewards of business.

Question 5

What professional ethics do accountants need?

Answer 5

integrity and objectivity

Question 6

State the features of the professional ethics

Answer 6

1. integrity: is straightforward and honest in all professional relationships.
2. objectivity: is objective and will not let bias, conflict of interests, or the undue influence of others override his or her professional judgement.

Question 7

What are the two types of business?

Answer 7

trading and service business

Question 8

What is the definition of a trading business?

Answer 8

a trading business buys goods from the supplier and then sells the goods to the customers.

Question 9

What are some examples of a trading business?

Answer 9

1. bookshop.
2. supermarket.
3. ice cream shop.

Question 10

What are some examples of a service business?

Answer 10

1. cleaning services.
2. medical services.
3. banking services.

Question 11

What is the definition of a service business?

Answer 11

a service business provides services to its customers.