Quiz - 1 - Overview of Accounting-Printing
Quiz - 1 - Overview of Accounting-Printing
2. All of the following are events considered as exchange or reciprocal transfer, except
13. Which of the following statements correctly refer to the accounting process?
I. Measuring is the accounting process of analyzing business activities as to
whether or not they will be recognized in the books.
II. Recognition refers to the process of including the effects of an event in the totals
of the statement of financial position or the statement of profit or loss and other
comprehensive income through memo entries.
III. Disclosure of events in the notes to financial statement without including their
effect in the totals of the statement of financial position or statement of profit or
loss and other comprehensive income is not an application of the recognition
principle.
IV. An accountable event is an event that has an effect on the assets, liabilities or
equity of an entity and its effect can be measured reliably.
V. Sociological and psychological matters are within the scope of accounting.
a. I, II, III, IV and V c. IV
b. I, II, III and IV d. III and IV
16. During the lifetime of an entity, accountants produce financial statements at arbitrary
points in time in accordance with which basic accounting concept?
a. Cost/benefit constraint c. Conservatism constraint
b. Periodicity assumption d. Matching principle
17. What accounting concept justifies the use of accruals and deferrals?
a. Going concern assumption c. Consistency characteristic
b. Materiality constraint d. Monetary unit assumption
18. The assumption that a business enterprise will not be sold or liquidated in the near
future is known as the
a. economic entity assumption. c. conservatism assumption.
b. monetary unit assumption. d. going concern.
19. Valuing assets at their liquidation values rather than their cost is inconsistent with
the
a. periodicity assumption. c. materiality constraint.
b. matching principle. d. historical cost principle.
20. When products or other assets are exchanged for cash or claims for cash, they are
said to be
a. allocated. c. recognized.
b. realized. d. earned.