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    16 views4 pages

    pdfcoffee.com_far-zeus-millan-pdf-free

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    mueronggailmark9

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    FAR-ZEUS B.

    MILLAN

    PROBLEM 1: TRUE OR FALSE

    1. The main purpose of accounting is to provide information that is useful in making economic
    decisions. -TRUE
    2. All business transactions are recorded in the books of accounts. FALSE
    3. Accounting information is expressed both in numbers (e.g., monetary amount) and in words
    (e.g., descriptions and explanatory information.- TRUE
    4. Accounting is considered practical art because it requires the use of creative skills and
    judgment.TRUE
    5. Accounting, as an information system, consists of an input, a process and an output.
    6. Although bookkeeping is part of accounting, the two are not the same.
    7. Entity A buys goods and sells them at a mark-up. Entity A is a merchandising business.
    8. Entity B is required to file audited annual financial statements with the SEC. Entity B can either
    be a corporation or a partnership, but not a sole proprietorship or a cooperative.
    9. A school is most likely to be considered manufacturing business- the raw materials are the
    students and the finished products are responsible and competent business professionals/
    10. A business that produces goods in large quantities can save on fixed costs. This is called
    economies of scale.

    PROBLEM 2: TRUE OR FALSE

    1. Only accountable events are recorded in the books of accounts. Accountable events are those
    that affect the accountant.
    2. General purpose financial staments are the end product of the financial accounting process.
    These statements are intended for internal users.
    3. Accounting is the major facet of a business that is responsible in generating funds needed to
    support the business operatons.
    4. A business transaction is considered an accountable event if it affects the assets, liabilities,
    equity, income or expenses of the business.
    5. You and our friend are members in a cooperative. You hold 1 share, while your friend holds
    10,000 shares. During members’ meetings, your friend can cast 10,000 votes, whereas you can
    only cast 1 vote.
    6. Mr. A owns and manages a sole proprietorship business. The financial reports prepared tailored
    to Mr. A’s financial information needs are not general purpose financial statement.
    7. Mr. (in #6 above) accepts Mr. B as co-owner to his business. The business is now called A&B Co.
    The business of Mr. A and Mr. B is apartnership.
    8. Mrs. C is a taxi and jeepney operator. Mrs. C has sthree taxis and five jeepneys. Mrs. C’s business
    is registered with the DTI. Mrs. C’s business is a corporation.
    9. Mr. A and Mr. B in #7 above decided to acquire the business of Mrs. C in #8 . The newly formed
    business is called ABC, Inc. ABC, Inc.is owned by Mr. A,Mrs. C and two drivers of to only few
    individuals (i.e., the organizations top owners) restricting the redistribution of wealth to the
    majority of the members of the society.
    a. Cooperative c. Partnership
    b. Sole proprietorship d. Corporation

    PROBLEM 3: FOR CLASSROOM DISCUSSION

    Definition, nature and function of Accounting

    1. Which of the following does not properly describe accounting?


    a. It is a process by which useful information is generated
    b. It is a social science
    c. It requires the application of creative skills and judgement
    d. It is often reffered to as the “language of the soul”

    Users of accounting information

    2. Which of the following is considered an internal user of financial information?


    a. Rank and file employees of the reporting entity
    b. Stockholders of the entity who are not directly involved in managing the entity
    c. Lenders and other creditors
    d. The entity’s management
    3. What type of information needs of users do general purpose financial statement caters to?
    a. Common needs c. a and b
    b. Specific needs d. caring needs
    4. Which of the following is least likely to be a decision made by an external user of the financial
    information of n entity?
    a. Whether to buy, hold or sell investment in stocks
    b. Whether to extend loan or other forms of credit
    c. Whether to obtain additional financing
    d. All of these are decisions that external users make

    Branches of Accounting

    5. This branch of accounting deals with the preparation of general purpose financial statements
    a. General accounting c. Financial accounting
    b. Management Accounting d. Auditing
    6. General purpose financial statements are intended to meet
    a. All the information needs of all users- external and internal alike.
    b. The common needs of both external and internal users
    c. The common needs of both external users, primarily investors, lenders and other creditors
    d. Both the common and specific neds of external users
    Forms of business organizations.

    7. This type of business organization is created by a contractual agreement between two or more
    individuals
    a. Corporation c. partnership
    b. Cooperative d. sole proprietorship

    Types of business according to activities

    8. Which of the following refers to a manufacturing business?


    a. Busing and selling of goods in their original form
    b. Sale of a skill-set and not necessarily a physical object
    c. Ability or potential to mass-produce

    Advantages and disadvanatges of the diferent types of business

    9. A disadavantage of a partnership is
    a. Better decisions-“two heads are better than one”
    b. Business risk is assumed by more than one owner
    c. Unlimited life
    d. Unlimited libilities of the partners
    10. This type of business organization has the tendency to become monopolistic. It can hamper the
    economy by funneling wealth to only few individuals (i.e., the organization’s top owners)
    restricting the redistribution of wealth to the majority of the members of the society
    a. Cooperative c. Partnership
    b. Sole proprietorship d. Corporation

    PROBLEM 4: MULTIPLE CHOICE

    1. Which of the following does not properly describe accounting?


    d. It is often referred to as the “language of the soul”
    2. Which of the following is considered an internal user of financial information?
    d. The entity’s management
    3. What type of information needs of users do general purpose financial statements cater to?
    a. common needs

    Which of the following is least likely to be a decision made by n external user of the financial
    information of an entity?

    d. all of these are decisions that external users make

    5. This branch of accounting deals with the preparation of general purpose fiannacial statements.

    c. Financial Accouting
    6. General purpose financial statements are intended to meet

    c. the common needs of external users, primarily investors, lenders nd other creditors

    7. This type of business organization is created by a contractual agreement between two or more
    individuals

    c. partnership

    8. Wich of the following refers to a manufacturing business?

    c. ability or potential to mass-produce

    9. A disadvantage of a partnership is

    d. unlimited liabilities of the partners

    10. This type of business organization has the tendency to become monopolistic. It can hamper the
    economy by funneling wealth to only few individuals (i.e., the organization’s top owners) restricting
    the redistribution of wealth to the majority of the members of the society

    a. Cooperative

    PROBLEM 4: MULTIPLE CHOICE

    1. Which of the following statement is correct?

    a. Accounting is not a service activity

    b. Both accountable and non-accountable events are recorded in the books of accounts

    c. Recording is the ccounting process in which financial statements are prepared

    d. Posting is the process of classifiying the effects of recorded events on the accounts

    2. It is the basic storage

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