ACC 100 MIDTERM (with complete solutions)

Business correct answers Activity of making, buying, or selling goods or providing services in exchange for money (for-profit business) Primary sector correct answers Deal with growing / gathering raw materials or resources i.e.. farms, coal mining, oil drilling Secondary Sector correct answers Turns raw materials into products ie. car manufactures, factories Tertiary sector correct answers provides goods or services that are sold to consumers ie. restaurants, hair dressers, music shops Retailers correct answers earn profit by reselling or providing services to consumers to satisfy wants or needs Wholesalers correct answers Buy large quantities of goods from manufacturers, warehouses them, and sells them to retailers Stakeholders correct answers Individuals or groups who affect or affected by business and have objectives / wants from relationship with business Internal stakeholders correct answers Work for business and their objective is to keep job, get promoted, do job more efficiently, and get payed. ie. tax manager, owners, employees External Stakeholder correct answers individuals or groups outside of business with objectives of making decisions about money (resource allocation decisions) or how business affects them ie. shareholders, government, customer, suppliers, creditors, and society Internal users correct answers Users of financial info from within the company i.e.. employees: accounting, cash flows, collection External Users correct answers Users of financial info from outside the company ie. creditors: use to determine if they should loan money Accounting System correct answers information system that collects, groups, and communicates a business's financial position. Process changes financial data into financial info in form of financial statements Financial Statement correct answers Provide financial performance, current financial position and cash flows Qualitative characteristics correct answers qualities that stakeholders want in financial statements Faithful Quality correct answers truthful, complete, free of error, and neutral / unbiased