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N LVLS SUCK > POA SUMMARY > Flashcards

POA SUMMARY Flashcards

1
Q
  1. Name the features of sole proprietorship
A
  1. the sole proprietor is the only owner of the business.
  2. the sole proprietor has full control over the management of the business.
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2
Q
  1. What is the role of accounting?
A

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.

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2
Q
  1. Name the stakeholders and their features
A
  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.
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2
Q
  1. What are the role of accountants?
A
  1. accountants set up an accounting information system.
  2. become stewards of business.
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3
Q
  1. What professional ethics do accountants need?
A

integrity and objectivity

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4
Q
  1. State the features of the professional ethics
A
  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.
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5
Q
  1. What are the two types of business?
A

trading and service business

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6
Q
  1. What is the definition of a trading business?
A

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

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6
Q
  1. What are some examples of a trading business?
A
  1. bookshop.
  2. supermarket.
  3. ice cream shop.
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7
Q
  1. What are some examples of a service business?
A
  1. cleaning services.
  2. medical services.
  3. banking services.
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8
Q
  1. What is the definition of a service business?
A

a service business provides services to its customers.

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9
Q
  1. What are the types of source documents?
A
  1. receipt.
  2. invoice.
  3. credit note.
  4. debit note.
  5. payment voucher/ remittance advice.
  6. bank statement.
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9
Q
  1. What is the definition of a cash transaction?
A

payment is made at the same time or immediately during a cash sale or purchase.

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9
Q
  1. What is the definition of a credit transaction?
A

payment is delayed or postponed during a credit sale or purchase.

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10
Q
  1. What are the two types of business transactions?
A

cash and credit transaction

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10
Q
  1. What is the purpose of a receipt?
A

sale/ purchase of goods/services on cash basis.

11
Q
  1. What is the purpose of an invoice?
A

sale/ purchase of goods/services on credit basis.

12
Q
  1. What is the purpose of a bank statement?
A

bank charges/ direct credit transfer/ direct deposit

12
Q
  1. What is the purpose of a debit note
A

undercharge of goods/services

12
Q
  1. What is the purpose of a credit note?
A

return of goods or overcharge of goods/services

13
Q
  1. What are the accounting theories used for chapter 2?
A

monetary theory, objectivity theory, historical cost theory

13
Q
  1. What is the purpose of a payment voucher/ remittance advice?
A

payment of goods/services to suppliers

14
Q
  1. State the source documents cycle
A

Source Documents -> Journal -> Ledger -> Trial Balance -> Financial Statements

14
Q
  1. State the accounting information system
A

Identify & Record -> Adjust -> Report -> Close

15
Q
  1. State the objectivity theory
A

According to the objectivity theory, accounting information recorded must be supported by reliable and verifiable evidence so that financial statements will be free from opinions and biases.

15
Q
  1. State the monetary theory
A

According to the monetary theory, only business transactions that can be measured in monetary terms are recorded.

16
Q
  1. State the historical cost theory
A

According to the historical cost theory, transactions should be recorded at their original cost.

N LVLS SUCK (8 decks)

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