KSU ACCTG 231 Final Study
Questions with complete solution
2025/2026
External Users - correct answer ✔Persons using accounting information who are not directly involved
in running the organization.
Internal Users - correct answer ✔Persons using accounting information who are directly involved in
managing the organization.
Service Businesses - correct answer ✔A type of business that performs intangible activities that satisfy
the wants of consumers or industrial users
Merchandising Businesses - correct answer ✔sell products they purchase from other businesses to
customers
Manufacturing Businesses - correct answer ✔companies that make the goods they sell to customers
Sole Proprietorship - correct answer ✔A business owned by one person
Partnership - correct answer ✔a business owned by two or more people
Corporations - correct answer ✔a company or group of people authorized to act as a single entity
(legally a person) and recognized as such in law.
Benefits > Cost - correct answer ✔The benefits of the information must exceed the costs to provide or
obtain that information. This applies to all of the elements of the characteristics of information
, Decision Usefulness - correct answer ✔Relevant and Faithfully Representation
Relevance - correct answer ✔information capable of making a difference in a decision
Predictive Value - correct answer ✔potential to form an opinion or gain insight about future events
Confirmatory Value - correct answer ✔confirms or corrects prior expectations
Materiality - correct answer ✔Information is material if leaving it out it or misstating it could influence
decisions that users make on the specific entity
Faithful Respresentation - correct answer ✔To be completely useful
Complete - correct answer ✔All the information necessary for a user to understand
Neutral - correct answer ✔Information that is without bias in what is selected
Free from Error - correct answer ✔The information is accurate in all aspects
Enhancing Qualitative Characteristics - correct answer ✔Understandability, Timeliness, Verifiability,
Comparability
Understandability - correct answer ✔Information must be properly classified, characterized and
presented clearly
Timeliness - correct answer ✔The information must be available to decision makers in time to be
capable of influencing their decisions
Questions with complete solution
2025/2026
External Users - correct answer ✔Persons using accounting information who are not directly involved
in running the organization.
Internal Users - correct answer ✔Persons using accounting information who are directly involved in
managing the organization.
Service Businesses - correct answer ✔A type of business that performs intangible activities that satisfy
the wants of consumers or industrial users
Merchandising Businesses - correct answer ✔sell products they purchase from other businesses to
customers
Manufacturing Businesses - correct answer ✔companies that make the goods they sell to customers
Sole Proprietorship - correct answer ✔A business owned by one person
Partnership - correct answer ✔a business owned by two or more people
Corporations - correct answer ✔a company or group of people authorized to act as a single entity
(legally a person) and recognized as such in law.
Benefits > Cost - correct answer ✔The benefits of the information must exceed the costs to provide or
obtain that information. This applies to all of the elements of the characteristics of information
, Decision Usefulness - correct answer ✔Relevant and Faithfully Representation
Relevance - correct answer ✔information capable of making a difference in a decision
Predictive Value - correct answer ✔potential to form an opinion or gain insight about future events
Confirmatory Value - correct answer ✔confirms or corrects prior expectations
Materiality - correct answer ✔Information is material if leaving it out it or misstating it could influence
decisions that users make on the specific entity
Faithful Respresentation - correct answer ✔To be completely useful
Complete - correct answer ✔All the information necessary for a user to understand
Neutral - correct answer ✔Information that is without bias in what is selected
Free from Error - correct answer ✔The information is accurate in all aspects
Enhancing Qualitative Characteristics - correct answer ✔Understandability, Timeliness, Verifiability,
Comparability
Understandability - correct answer ✔Information must be properly classified, characterized and
presented clearly
Timeliness - correct answer ✔The information must be available to decision makers in time to be
capable of influencing their decisions
