Test bank Mid Flashcards
Correct order in which the steps in the decision making process occur?
Establish goal
Gather available info
Evaluate consequences
Choose actions
Accounting process
Identifying: transaction
Measuring: quantification in money terms
Recording: record, classify and summarize
Communicating: by accounting report & analysis & interpret
Events that are the economic activities of an entity
transaction
The winding up of the affairs of a company
liquidation
Accounting that deals with the cost of a product or service
cost accounting
A choice made
decision
An independent professional review service
assurance
Traded scarce resources
economic
Ongoing investigation of compliance with procedures and polices of an entity:
__________ audit
internal
Reports designed to meet the information needs of a wide range of users
general purpose report
An independent examination of the accounts by an accountant
audit
A __________ accounting system provides information to internal users
management
A plan for the future operating activities of a business
budgeting
Provides information to external users: __________ accounting
financial
Unable to pay debts as they fall due
insolvent/insolvency
Which of the following is not one of the four main questions to be followed in
making a decision?
(a) What are we trying to achieve?
(b) What information do we need?
(c) How long will it take?
(d) Which course of action will we choose?
(c)
Apart from the monetary impact, factors of decision making include:
(a) personal taste
(b) social factors
(c) environmental factors
(d) all of the above.
d
The retail market is where:
(a) the consumer buys groceries, clothes or home electrical goods
(b) retailers buy their supplies for on-selling in their different outlets
(c) individuals and business entities buy and sell shares
(d) people meet to swap, buy and sell hand-crafted and second-hand goods.
a
If accounting information is to be useful, it must be expressed in terms of:
(a) non-monetary units
(b) monetary and non-monetary units
(c) units of consumer demand
(d) a common denominator
d
An example of an internal transaction is when an entity:
(a) purchases merchandise from a supplier
(b) borrows money from a bank
(c) sells goods to a customer
(d) recognises the use over time of machinery and equipment.
d
An example of an external transaction is when an entity:
(a) pays an employee his/her fortnightly wages
(b) transfers merchandise from the stores department to the sales department
(c) recognises the use over time of machinery and equipment
(d) uses the maintenance department to service machinery and equipment.
a
. Questions raised by external users of accounting information include:
(a) Will the entity be able to repay its loans?
(b) What is the entity’s earning potential?
(c) Is the business in a financially sound position?
(d) All of the above.
d
For the purpose of decision making:
(a) accounting information provides information about future events
(b) accounting information provides information about the outcomes of past
decisions
(c) the future is used as a guide to past estimates
(d) the accountant never becomes involved in the budgeting process.
b
The rules of professional conduct set down by the joint Code of Professional
Conduct (CPC) are:
(a) to be used as a behavioural guide only
(b) unenforceable by the professional bodies
(c) mandatory for all members
(d) the concerns of public practitioners only.
c
The management accountant working in the commercial field will typically be involved in: (a) independent auditing (b) taxation services (c) management advisory services (d) cost accounting.
d
overseer and advisory body to the AASB-appoints members, monitors their overall direction/ set plans and budget:
(a) Australian accounting standard board (AASB)
(b) Australian securities and investment commission (ASIC)
(c) Financial Reporting council (FRC)
(d) Australian Stock Exchange (ASX)
c
Develop Aus accounting standards that comply with the international accounting standards (IAS), adopted conceptual framework, issue additional accounting standards
(a) Australian accounting standard board (AASB)
(b) Australian securities and investment commission (ASIC)
(c) Financial Reporting council (FRC)
(d) Australian Stock Exchange (ASX)
a
uses listings & rules to monitor company, improve disclosure of info
(a) Australian accounting standard board (AASB)
(b) Australian securities and investment commission (ASIC)
(c) Financial Reporting council (FRC)
(d) Australian Stock Exchange (ASX)
d
administer corporations law & protect the interest of investors, creditors and consumers
(a) Australian accounting standard board (AASB)
(b) Australian securities and investment commission (ASIC)
(c) Financial Reporting council (FRC)
(d) Australian Stock Exchange (ASX)
b
