FAC1502 Financial Accounting Concepts; Procedures and Concepts Study Set

FAC1502 Financial Accounting Concepts; Procedures and
Concepts Study Set
ACCOUNTINGz-zCORRECTzANSWER-Planning;zRecording;zAnalyzing;zInterpretingzfinancialzinformation.



PLANNINGzDECISIONSz-zCORRECTzANSWER-
Financialzinformationziszusedztozdeterminezfuturezactions.zHistoricalzinformationzprovidedzbyzthezaccounti
ngzprocesszserveszaszazbasiszforzforecasting.



CONTROLz-zCORRECTzANSWER-Usingzfinancialzinformationztozevaluatezthezresultszofzfinancialzactivities.



THEzFUNCTIONzOFzACCOUNTINGz-zCORRECTzANSWER-
1.zThezvaluezaddedztoztheznetworthzofzazperson/entityzduringzazparticularzperiod.

2.zThezaccumulatedznetworthzofzthatzperson/entity



PROFITzENTITIESz-zCORRECTzANSWER-Soleztraders;zPartnerships;zClosezCorporations;zCompanies



NON-PROFITzENTITESz-zCORRECTzANSWER-
Clubs;zCharitablezOrganisations;zChurches;zEducationalzInstitutions;zTrusts



PUBLICzSECTORz-zCORRECTzANSWER-
ThezGovernment;zProvinces;zDepartments;zBoardszandzCommissions;zMunicipalities



USERSzOFzFINANCIALzINFORMATIONz-zCORRECTzANSWER-1.zInvestorsz-
zProviderszofzcapital.zConcernedzwithzthezriskzinvolvedzinztheirzinvestment.zNeedzinformationztozdecidezw

hetherztozinvest,zhold,zorzwithdrawzfunds.



2.zEmployeesz-zInterestedzinzentity'szstabilityzandzprofitabilityzforzbenefitszandzjobzsecurity.z



3.zLendersz-zUsezfinancialzinformationztozdeterminezifzloanszcanzbezpaidzbackzwithzinterest.

,4.zSupplierszandzotherztradezcreditorsz-
zUsezinformationszforzassurancezthatzamountszowedzarezpaidzonztime.




5.zCustomersz-zNeedztozknowzthezstatezofzthezentityzforzreliability.



6.zGovernmentzandztheirzagenciesz-
zUsezfinancialzinformationzforztaxation,zpolicies,zandzstatisticalzpurposes.




7.zPublicz-zEntitieszoftenzcontributeztozthezlocalzeconomyzbyzemployingzpeoplezandzlocalzstructures:



STATEMENTzOFzPROFITzORzLOSSzANDzOTHERzCOMPREHENSIVEzINCOMEz-zCORRECTzANSWER-
Financialzresultsz-->zFinancialzPerformancez(financialzperiod)z--->zFinancialzPosition



STATEMENTzOFzCHANGESzINzEQUITYz-zCORRECTzANSWER-
Reflectszthezprofitzorztotalzcomprehensivezincomezandzreflectszthezcapitalzorzequity.



STATEMENTzOFzFINANCIALzPOSITIONz-zCORRECTzANSWER-
Reflectsztheznetworthzofzthezentityzatzazspecificztime.zDeterminedzinztermszofzassetszandzinterests.zAffecte
dzbyzthezentity'szeconomiczresources,zstructure,zliquidity,zsolvency,zcapacityztozadaptztozeconomiczchange
s.



STATEMENTzOFzCASHzFLOWSz-zCORRECTzANSWER-
Thezabilityztozgeneratezcashzwillzdeterminezwhetherzthezentityzwillzbezableztozmeetzitszeconomiczcomittm
ents.



DOMAINSzOFzACCOUNTINGz-zCORRECTzANSWER-1.zFinancialzaccounting:zExternalzusersz-
zCreditors;zClients;zBankingzinstitutions.z


2.zManagementzaccounting:zInternalzusersz-zManagement;zPersonnel



ACCOUNTINGzPRINCIPLESz-zCORRECTzANSWER-
Theztechniqueszusedzinzthezpracticezofzaccounting.zConceptualzandzTheoretical.

, ACCOUNTINGzPOLICYz-zCORRECTzANSWER-
Azsetzofzdecisionszabutzhowzthezentityzwillzhandlezthezsameztypezofztransactionzinzorderztozachievezconsist
ency.



INTERNATIONALzFINANCIALzREPORTINGzSTANDARDSz(IFRS)z-zCORRECTzANSWER-
Azgeneralzframeworkzandzaccountingzconcepts;zpricinciples;zmethodszandzprocedures.



ACCOUNTINGzSTANDARDSzANDzSTATEMENTSz-zCORRECTzANSWER-
Aimztozencouragezwidespreadzusezofzparticularzstandardsztozeliminatezbadzalternatives.



GOINGzCONCERNzASSUMPTIONz-zCORRECTzANSWER-
assumeszanzentityzwillzremainzinzoperationzforzthezforeseeablezfuture.



QUALITIVEzCHARACTERISTICSzOFzFINANCIALzSTATEMENTSz-zCORRECTzANSWER-
Attributeszthatzmakezthezinformationzprovidedzinzfinancialzstatementszuseful.zRelevance;zFaithfulzPresent
ation;zComparibility;zVerifiability;zTimeliness;zUnderstandability



ELEMENTSzOFzFNANCIALzSTATEMENTSz-zCORRECTzANSWER-FinancialzPositionz-
zAssets;zLiabilities;zEquity;zFinancialzPerformancez-zIncome;zExpenses




RECOGNITIONzOFzELEMENTSzOFzFINANCIALzSTATEMENTSz-zCORRECTzANSWER-1.zConceptzofzProfitabilityz-
zUsedzinzthezrecognitionzcriteria


2.zReliabilityzofzMeasurez-
zAnzitemzmustzpossesszazcostzorzvaluezthatzcanzbezmeasuredzreliablyzbeforezitzcanzbezrecognized.




ACCOUNTINGzENTITYz-zCORRECTzANSWER-Iszthezorganizationzforzwithzfinancialzdatazareztozbezcollected.



FINANCIALzRESULTz-zCORRECTzANSWER-
Reportedzinzthezfinancialzstatements.zStatemenzofzFinancialzPosition;zStatementzofzProfitzorzLosszandzOth
erzComprehensivezIncome;zStatementzofzChangeszinzEquity;zAzStatementzofzCashzFlows;zAccountingzPolici
eszandzNotes.



FINANCIALzPERIODz-zCORRECTzANSWER-
Theztimeframezusedztozgeneratezfinancialzstatementszduringzthezorganization'szexistence.zStatementszpre