FAC 1502 MOCK PAPER Questions and
Answers Verified Solutions Latest
Update
Question:
PLANNING DECISIONS.
Answer:
Financial information is used to determine future actions. Historical information
provided by the accounting process serves as a basis for forecasting.
Question:
CONTROL.
Answer:
Using financial information to evaluate the results of financial activities.
Question:
THE FUNCTION OF ACCOUNTING.
Answer:
1. The value added to the networth of a person/entity during a particular period.
Question:
The accumulated networth of that person/entity
Question:
PROFIT ENTITIES.
Answer:
Sole traders; Partnerships; Close Corporations; Companies
,Question:
NON-PROFIT ENTITES.
Answer:
Clubs; Charitable Organisations; Churches; Educational Institutions; Trusts
Question:
PUBLIC SECTOR.
Answer:
The Government; Provinces; Departments; Boards and Commissions; Municipalities
Question:
USERS OF FINANCIAL INFORMATION.
Answer:
1. Investors-Providers of capital. Concerned with the risk involved in their investment.
Need information to decide whether to invest, hold, or withdraw funds.
Question:
Employees-Interested in entity's stability and profitability for benefits and job security.
Question:
Lenders-Use financial information to determine if loans can be paid back with interest.
Question:
Suppliers and other trade creditors-Use informations for assurance that amounts owed
are paid on time.
Question:
Customers-Need to know the state of the entity for reliability.
Question:
Government and their agencies-Use financial information for taxation, policies, and
statistical purposes.
, Question:
Public-Entities often contribute to the local economy by employing people and local
structures
Question:
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME.
Answer:
Financial results --> Financial Performance (financial period) -- -> Financial Position
Question:
STATEMENT OF CHANGES IN EQUITY.
Answer:
Reflects the profit or total comprehensive income and reflects the capital or equity.
Question:
STATEMENT OF FINANCIAL POSITION.
Answer:
Reflects the networth of the entity at a specific time. Determined in terms of assets
and interests. Affected by the entity's economic resources, structure, liquidity,
solvency, capacity to adapt to economic changes.
Question:
STATEMENT OF CASH FLOWS.
Answer:
The ability to generate cash will determine whether the entity will be able to meet its
economic comittments.
Question:
DOMAINS OF ACCOUNTING.
Answer:
1. Financial accounting: External users-Creditors; Clients; Banking institutions.
Question:
Management accounting: Internal users-Management; Personnel
Answers Verified Solutions Latest
Update
Question:
PLANNING DECISIONS.
Answer:
Financial information is used to determine future actions. Historical information
provided by the accounting process serves as a basis for forecasting.
Question:
CONTROL.
Answer:
Using financial information to evaluate the results of financial activities.
Question:
THE FUNCTION OF ACCOUNTING.
Answer:
1. The value added to the networth of a person/entity during a particular period.
Question:
The accumulated networth of that person/entity
Question:
PROFIT ENTITIES.
Answer:
Sole traders; Partnerships; Close Corporations; Companies
,Question:
NON-PROFIT ENTITES.
Answer:
Clubs; Charitable Organisations; Churches; Educational Institutions; Trusts
Question:
PUBLIC SECTOR.
Answer:
The Government; Provinces; Departments; Boards and Commissions; Municipalities
Question:
USERS OF FINANCIAL INFORMATION.
Answer:
1. Investors-Providers of capital. Concerned with the risk involved in their investment.
Need information to decide whether to invest, hold, or withdraw funds.
Question:
Employees-Interested in entity's stability and profitability for benefits and job security.
Question:
Lenders-Use financial information to determine if loans can be paid back with interest.
Question:
Suppliers and other trade creditors-Use informations for assurance that amounts owed
are paid on time.
Question:
Customers-Need to know the state of the entity for reliability.
Question:
Government and their agencies-Use financial information for taxation, policies, and
statistical purposes.
, Question:
Public-Entities often contribute to the local economy by employing people and local
structures
Question:
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME.
Answer:
Financial results --> Financial Performance (financial period) -- -> Financial Position
Question:
STATEMENT OF CHANGES IN EQUITY.
Answer:
Reflects the profit or total comprehensive income and reflects the capital or equity.
Question:
STATEMENT OF FINANCIAL POSITION.
Answer:
Reflects the networth of the entity at a specific time. Determined in terms of assets
and interests. Affected by the entity's economic resources, structure, liquidity,
solvency, capacity to adapt to economic changes.
Question:
STATEMENT OF CASH FLOWS.
Answer:
The ability to generate cash will determine whether the entity will be able to meet its
economic comittments.
Question:
DOMAINS OF ACCOUNTING.
Answer:
1. Financial accounting: External users-Creditors; Clients; Banking institutions.
Question:
Management accounting: Internal users-Management; Personnel
