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Accounting > Module 1 > Flashcards

Module 1 Flashcards

1
Q

Accounting is a (1)________of (2)__________, (3)__________ , and (4)___ _________economic information to permit informed judgments and decisions by the (5)___________.

A
  1. Process
  2. Identifying
  3. Measuring
  4. Communicating
  5. Users of Information
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2
Q

Accounting is a 1__________ activity. Its function is to provide 2,_______ information primarily financial in nature about economic 3__________ that is intended to be useful in making 4._________

A
  1. Service
  2. Quantitative
  3. Entities
  4. Economic Decisions
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3
Q

is a service activity. Its function is to provide quantitative information primarily financial in nature about economic entities that is intended to be useful in making economic decisions.

A

Accounting

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4
Q

is the art of recording, classifying and summarizing in a significant manner, transactions and events which are in part at least of a financial character and interpreting the result thereof.

A

Accounting

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5
Q

It is a process of identifying, measuring and communicating economic information to permit informed judgments and decisions by the users of information.

A

Accounting

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6
Q

is the art of (1)_________,(2)_________ and (3)_____________ in a significant manner, transactions and events which are in part at least of a (4)____ _________ and (5)________ the result thereof.

A
  1. Recording
  2. Classifying
  3. Summarizing
  4. Financial Character
  5. Interpreting
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7
Q

It involves systematic methods to perform tasks to achieve objectives.

A

Accounting is a process

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8
Q

the process of recognition or non-recognition of business transactions as accountable events for recording purposes. Note: the event is said to be accountable when it affects the assets, liabilities, equity, income and expenses of a business

A

Identifying

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9
Q

the process of assigning peso value or amount to the identified accountable event

A

Measuring

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10
Q

the process of preparation and distribution of financial reports. The information from different transactions and events identified, processed, measured in accounting information system to produce meaningful reports commonly known as financial statements.

A

Communicating

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11
Q

It consists of definite techniques and its proper application requires the use of creative skills, functions, expertise and judgment.

A

Accounting is a practical art

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12
Q

the preparation of journal entry in the process called journalizing.

A

Recording

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13
Q

the grouping of accounts with similar nature and characteristics

A

Classifying

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14
Q

the preparation of financial reports

A

Summarizing

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15
Q

the analytical function

A

Interpreting

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16
Q

It is a body of knowledge which has been systematically gathered, classified and organized.

A

Accounting is a social science

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17
Q

Accounting is the _____________ because it quantifies and facilitates the communication between the economic entity (business) and the users. These users or decision- makers need information. The more important their decision is, the greater is their need for reliable information. Then, the role of accounting becomes important. The accounting functions to provide relevant information to users serves as the useful basis or guide in making economic sound decisions. Accounting helps the users of to understand the clear picture of the business in financial terms..

A

language of business

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18
Q

are the fund providers of the business

A

Primary Users

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19
Q

are those who provide money, investment, capital or other resources for a business

A

Investors

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20
Q

could be a person, bank or other enterprise that has lent money or extended credit to another party/ies

A

Lender and Other Creditors

21
Q

are users of financial information other than primary users

A

Other Users

22
Q

work for others someone who is paid to

A

Employee

23
Q

an individual or enterprise. that purchases the products of the business.

A

Customer

24
Q

This types of users (BIR, SEC)

A

Government and their Agencies

25
Q

relating to people in general

A

Public

26
Q

Give the 3 Basic Accounting Concept

A
  1. Entity Concept
  2. Periodicity Concept
  3. Stable Monetary unit Concept
27
Q

each entity should be evaluated separately; it separates owners from the business.

A

Entity Concept

28
Q
  • divides the life of an entity into equal time periods, like month, quarter or years, allows users to obtain timely data for a specific period to serve as a basis of decision making.
A

Periodicity Concept

29
Q

treats peso amounts as though each peso has the same purchasing power as any other peso at any time; effects of inflation are ignored

A

Stable monetary unit concept

30
Q

Give the 8 Basic Accounting Principles

A
  1. Objectivity principle
  2. Historical Cost
  3. Revenue Recognition Principle
  4. Expense Recognition Principle
  5. Adequate disclosure
  6. Materiality
  7. Consistency
  8. Matching Principle
31
Q

accounting records and statements are based on reliable data and supported by verifiable documentation

A

Objectivity principle

32
Q

acquired assets should be recorded at their actual cost and not at what management thinks they are worth as at reporting date

A

Historical cost

33
Q

revenue is to be recognized in the accounting period when goods are delivered or services are rendered or performed

A

Revenue recognition principle

34
Q

should be recognized in the accounting period in which goods & services are used to produce revenue and not when entity pays for those goods & services

A

Expense recognition principle

35
Q

requires that all relevant information that would affect the user’s understanding and assessment of the accounting entity be disclosed in the financial statements

A

Adequate disclosure

36
Q

dictates that financial reporting should only be concerned with information that is significant to affect evaluations and decisions.

A

Materiality

37
Q

dictates that firms should use the same accounting method from period to period to achieve comparability over time within a single enterprise.

A

Consistency

38
Q

the costs of doing business are recorded in the same period as the revenue they help to generate.

A

Matching Principle

39
Q

True or False

  1. Primary Users are the fund providers of the business.
  2. Accounting is both an art and a science.
  3. Customers are interested in financial information which enables them to assess the stability and profitability of the company

4.revenue recognition principle states revenue is to be recognized in the accounting period when services are paid for cash

  1. Expense recognition principle dictates that expenses should be recognized in the accounting period in which they are incurred
  2. In entity concept, the business and the owner are treated as separate and distinct entity.
  3. Summarizing function of accounting is the grouping of accounts with similar nature and characteristics
  4. Other users are users of financial information other than primary users
  5. All events in business are accountable events.
  6. Accounting is a social science because it is a body of knowledge which has been
A

T
T
F
F
T
T
F
T
F
T

40
Q

It is an information system that measures, processes and communicates financial information about an identifiable economic entity

A

Accounting

41
Q

These are business organizations or units that have an identity separate from those of its owners

A

Entity Concept

42
Q

It is the process of assigning peso value to the accountable events

A

Measuring

43
Q

It is the process of preparation and distribution of accounting information to the intended users

A

Communicating

44
Q

It is the principle stating that accounting records and statements should be based on reliable data and supported by verifiable documentation

A

Objectivity Principle

45
Q

It is the product or output of accounting process

A

Financial Statements

46
Q

These are the tangible products which can be sold to the customers of the business

A

Tangible Goods

47
Q

Information expressed in money.

A

Quantitative Financial Information

48
Q

This principle which dictates that firms should use the same accounting method from period to period to achieve comparability over time within a single enterprise

A

Consistency Principle

49
Q

This allows users to obtain timely data for a specific period to serve as a basis of decision making.

A

Periodicity Concept

Accounting (5 decks)

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