ACC 406 QUESTIONS WITH CORRECT
ANSWERS 2025/2026
What is the purpose of accounting? - CORRECT ANSWER -The purpose is to decide which events
to capture data, what data relating to each event should be captured, how the data is to be
captured while preventing input errors, how the data should be stored to optimize its usability
while maintaining its intefrity, and how meaningful reports can be generated on demand in real
time.
Accounting involves processing raw data into what? - CORRECT ANSWER -Information that can
be comunicated to interested parties
Processed raw data is then communicated to whom? - CORRECT ANSWER -Interested Parties
Financial reports serve as what? - CORRECT ANSWER -Information Outputs
Basic accounting classes cover what types of accounting model? - CORRECT ANSWER -Double
Entry Accounting Model
Who is credited with developing this model? - CORRECT ANSWER -Franciscan Monk Luca Pacioli
What year did he develop it? - CORRECT ANSWER -1494
The basic accounting model focuses on what? - CORRECT ANSWER -financial and most easily
measurable
What are the two types of information customers? - CORRECT ANSWER -internal or external
, Internal customers work where? - CORRECT ANSWER -employees of all levels
Meeting internal information needs has been the domain of what? - CORRECT ANSWER -
Management accounting
The IMA stands for what? - CORRECT ANSWER -Institue of management accounting
Investors and stockholders are what type of information customers? - CORRECT ANSWER -
External
What does GAAP stand for? - CORRECT ANSWER -Generally Accepted Accounting Principles
The accounting Equation states what? - CORRECT ANSWER -Assets = Stockholder Equity +
Liabilities
Owner's Equity decreases when what occurs? - CORRECT ANSWER -dividends
What is the starting point for the accounting process? - CORRECT ANSWER -The Transaction
What is purpose of special journals? - CORRECT ANSWER -simplify the tasks of recording.
What are some examples of transactions that would be placed in a special journal? - CORRECT
ANSWER -Sales, Purchases, cash receipts and cash disbursements
Define journals. - CORRECT ANSWER -Temporary stores of transaction information
Define ledgers. - CORRECT ANSWER -Holds all other accounts including summary accounts
ANSWERS 2025/2026
What is the purpose of accounting? - CORRECT ANSWER -The purpose is to decide which events
to capture data, what data relating to each event should be captured, how the data is to be
captured while preventing input errors, how the data should be stored to optimize its usability
while maintaining its intefrity, and how meaningful reports can be generated on demand in real
time.
Accounting involves processing raw data into what? - CORRECT ANSWER -Information that can
be comunicated to interested parties
Processed raw data is then communicated to whom? - CORRECT ANSWER -Interested Parties
Financial reports serve as what? - CORRECT ANSWER -Information Outputs
Basic accounting classes cover what types of accounting model? - CORRECT ANSWER -Double
Entry Accounting Model
Who is credited with developing this model? - CORRECT ANSWER -Franciscan Monk Luca Pacioli
What year did he develop it? - CORRECT ANSWER -1494
The basic accounting model focuses on what? - CORRECT ANSWER -financial and most easily
measurable
What are the two types of information customers? - CORRECT ANSWER -internal or external
, Internal customers work where? - CORRECT ANSWER -employees of all levels
Meeting internal information needs has been the domain of what? - CORRECT ANSWER -
Management accounting
The IMA stands for what? - CORRECT ANSWER -Institue of management accounting
Investors and stockholders are what type of information customers? - CORRECT ANSWER -
External
What does GAAP stand for? - CORRECT ANSWER -Generally Accepted Accounting Principles
The accounting Equation states what? - CORRECT ANSWER -Assets = Stockholder Equity +
Liabilities
Owner's Equity decreases when what occurs? - CORRECT ANSWER -dividends
What is the starting point for the accounting process? - CORRECT ANSWER -The Transaction
What is purpose of special journals? - CORRECT ANSWER -simplify the tasks of recording.
What are some examples of transactions that would be placed in a special journal? - CORRECT
ANSWER -Sales, Purchases, cash receipts and cash disbursements
Define journals. - CORRECT ANSWER -Temporary stores of transaction information
Define ledgers. - CORRECT ANSWER -Holds all other accounts including summary accounts
