ACCY130 Inspera Quiz (Lecture week 3/4) WITH 100%
CORRECT ANSWERS; A+ GRADED.
Financial Statement correct answers Financial statements summarize and communicate
financial information to external users
External Accounting correct answers Recording, analyzing, and communicating
accountability information about an
organization for EXTERNAL users.
The accounting system produces three major
financial statements: correct answers • the income statement
• the balance sheet
• the cash flow statement
(also supporting financial statement)
What goes first?
• the income statement
• the balance sheet
• the cash flow statement correct answers Income statement always come first. This is
because there is information in the income statement that goes into the preparation of the
balance sheet.
Cash flow statement is prepared whenever.
Purpose of:
1. Income statement
2. Statement of changes in equity
3. Balance Sheet
4. Cash flow statement correct answers 1. Reports revenue less expenses for a particular of
period time.
2. Reports total comprehensive income and equity changes.
3. Reports assets, equity, liabilities at a particular point in time.
4. Reports of cash receipts and cash payments
Cash flow statement vs Profit or Loss/income Statement correct answers - The cash flow
statement only shows transactions when money has been exchanged. When we have paid for
something or when we pay something in cash.
- The income statement provides information on when the organization earns money and
when it has an obligation to pay money
How do we prepare financial statements? correct answers Step 1: Start organization, decide
on "reporting period", i.e.
what is your year end? Eg: (Year end: 1 April 202X - 31 March 202X)
• Step 2: Transact for the reporting period
• Step 3: Record each individual transaction in that reporting
period separately in an accounting information system under
, double-entry bookkeeping and general ledger
• Step 4: Summarize accounts in a trial balance
• Step 5: Prepare financial statements
• Step 6: Start again for the next accounting period
KEY FINANCIAL ACCOUNTING PRINCIPLES:
When preparing financial statements - and specifically
GPFSs - there are some generally accepted principles and
assumptions that govern the way in which financial
accounting information is recorded and subsequently
reported correct answers - These principles and assumptions have been developed over many
years and are generally accepted by accountants as representing appropriate practice.
- They inform the Accounting Standards (NZ IFRS and NZ
IPSAS).
Going Concern correct answers - An organization is considered likely to continue operating
into the foreseeable future, and without the likelihood of encountering any problems that
could result in the organization being wound up/discontinued
- If the organization is not a going concern, then financial statements have to be prepared on
another basis
- for example, on the basis of liquidation values.
The entity concept correct answers The accountant is only to recognize transactions and
events that affect the financial performance and/or position of the reporting Organization.
The organization is seen as separate from the
owners and other entities such that, personal
transactions of the owners are to be kept separate
from those of the organization.
Accounting period convention correct answers An accountant determines the financial
performance of the organization for smaller periods of time -
for example, 12 months.
Breaking up the life of an organization into smaller periods of time is necessary in order to be
able to devise indicators for how well the organization is performing.
Monetary unit convention correct answers The practice of financial accounting typically only
recognizes transactions or events if a related monetary
value can be assigned to those transactions or events.
(Monetary value must be represented in a single currency)
Accrual Basis of Accounting correct answers Financial accounting reports are generally
prepared on what is known as an accrual basis.
This means that:
CORRECT ANSWERS; A+ GRADED.
Financial Statement correct answers Financial statements summarize and communicate
financial information to external users
External Accounting correct answers Recording, analyzing, and communicating
accountability information about an
organization for EXTERNAL users.
The accounting system produces three major
financial statements: correct answers • the income statement
• the balance sheet
• the cash flow statement
(also supporting financial statement)
What goes first?
• the income statement
• the balance sheet
• the cash flow statement correct answers Income statement always come first. This is
because there is information in the income statement that goes into the preparation of the
balance sheet.
Cash flow statement is prepared whenever.
Purpose of:
1. Income statement
2. Statement of changes in equity
3. Balance Sheet
4. Cash flow statement correct answers 1. Reports revenue less expenses for a particular of
period time.
2. Reports total comprehensive income and equity changes.
3. Reports assets, equity, liabilities at a particular point in time.
4. Reports of cash receipts and cash payments
Cash flow statement vs Profit or Loss/income Statement correct answers - The cash flow
statement only shows transactions when money has been exchanged. When we have paid for
something or when we pay something in cash.
- The income statement provides information on when the organization earns money and
when it has an obligation to pay money
How do we prepare financial statements? correct answers Step 1: Start organization, decide
on "reporting period", i.e.
what is your year end? Eg: (Year end: 1 April 202X - 31 March 202X)
• Step 2: Transact for the reporting period
• Step 3: Record each individual transaction in that reporting
period separately in an accounting information system under
, double-entry bookkeeping and general ledger
• Step 4: Summarize accounts in a trial balance
• Step 5: Prepare financial statements
• Step 6: Start again for the next accounting period
KEY FINANCIAL ACCOUNTING PRINCIPLES:
When preparing financial statements - and specifically
GPFSs - there are some generally accepted principles and
assumptions that govern the way in which financial
accounting information is recorded and subsequently
reported correct answers - These principles and assumptions have been developed over many
years and are generally accepted by accountants as representing appropriate practice.
- They inform the Accounting Standards (NZ IFRS and NZ
IPSAS).
Going Concern correct answers - An organization is considered likely to continue operating
into the foreseeable future, and without the likelihood of encountering any problems that
could result in the organization being wound up/discontinued
- If the organization is not a going concern, then financial statements have to be prepared on
another basis
- for example, on the basis of liquidation values.
The entity concept correct answers The accountant is only to recognize transactions and
events that affect the financial performance and/or position of the reporting Organization.
The organization is seen as separate from the
owners and other entities such that, personal
transactions of the owners are to be kept separate
from those of the organization.
Accounting period convention correct answers An accountant determines the financial
performance of the organization for smaller periods of time -
for example, 12 months.
Breaking up the life of an organization into smaller periods of time is necessary in order to be
able to devise indicators for how well the organization is performing.
Monetary unit convention correct answers The practice of financial accounting typically only
recognizes transactions or events if a related monetary
value can be assigned to those transactions or events.
(Monetary value must be represented in a single currency)
Accrual Basis of Accounting correct answers Financial accounting reports are generally
prepared on what is known as an accrual basis.
This means that:
