Cfas (overview of accounting)

75問 • 11ヶ月前

問題一覧

It is the process of identifying, measuring, and communicating economic information to permit informed judgement and decisions by users of the information

accounting

These are the important activities included in the definition of accounting except:

analyzing

It is the process of analyzing events and transaction to determine whether or not they will be recognized

identifying

It refers to the process of including the effects of an accountable event in the statement of financial position or the statement of comprehensive income through journal entry

recognition

Only accountable events are recognized because it is the one that affects the five major account titles and non accountable are not recognized but disclosed only in notes. If the non accountable events has a relevance it will be recorded in where?

memorandum entry

This are events that involve an entity and another external party

external events

an event wherein there is a reciprocal giving and receiving of economic resources or discharging of economic obligation between an entity and external party

exchange or reciprocal transfer

A one way transaction in that the party is giving something but doesn’t receive anything in return, while the party receiving does not give anything in exchange

non reciprocal transfer

An event that does not involve changes in the economic resources or obligations of an entity caused by an external party or external source but does not involve transfers of resources or obligations.

external event other than transfer

what are the two types of internal events?

production and casualty

It involves assigning numbers, normally in monetary terms, to the economic transaction and events

measuring

Several measurement bases are used in accounting which include, but not limited to, historical cost, fair value, present value, realizable value, current cost, replacement cost and sometimes inflation-adjusted costs. The most commonly used in measuring is?

historical cost

It is the process of transforming economic data into useful accounting information, such as financial statements and other accounting reports, for dissemination to users.

communicating

refers to the process of systematically committing into writing the identified and measured accountable events in the journal through journal entries.

recording

involves the grouping of similar and interrelated items into their respective classes through postings in the ledger.

classifying

putting together or expressing in condensed form the recorded and classified transactions and events. This includes the preparation of financial statements and other accounting reports.

summarizing

Which of the following statements is true? .

a. The basic purpose of accounting is to provide information about economic activities intended to be useful in making economic decisions.

Various sources of information are used when making economic decisions and the financial statements are only one of those sources. Which of the following are not included in other sources used when making economic decisions?

other companies and economic activities

Information expressed in numbers

quantitative information

Information expressed in words

qualitative information

Information expressed in monetary units

financial information

It designed to meet the common needs of most statement users. This information is provided under financial accounting.

general purpose accounting information

It designed to meet the specific needs of particular statement users. This information is provided by other types of accounting other than financial accounting, e.g., managerial accounting, tax basis accounting.

special purpose accou information

Accounting is a body of knowledge which has been systematically gathered, classified and organized

as a social science

Accounting requires the use of creative skills and judgement

as a practical art

It involves the use of imaginations and insights to solve problems by finding new relationships among items of information

creative thinking

It involves the logical analysis of issues, using inductive and deductive reasoning

critical thinking

It refers to the principleupon which the process of accounting is based

accounting concepts

The fundamental concepts or principles and basic notions that provide the foundation of accounting process

accounting assumptions

RA 9298 is officially known as

The Philippine Accountancy Act of 2004

Which of the following statements is incorrect regarding the basic accounting concepts?

d. The time period concept means that financial statements are prepared only at the end of the life of a business.

It is the branch of accounting that focuses on the general purpose reports of financial position and operating results known as financial statements.

financial accounting

Accounting has been given various definitions, which of the following is not one of those definitions

C. Accounting is a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between these assertions and established criteria and communicating the results to interested users.

Each accountable event is recorded in two parts the debit and credit

double entry system

The entity is assumed to carry on its operations for an indefinite period of time

going concern assumption

The entity is viewed separately from its owners. Accordingly the personal transaction of the owners among themselves or with other entities are not recorded in the entity’s accounting records

separate entity

The purchasing power of peso is regarded as stable or constant and that is instability is insignificant and therefore ignored

stable monetary unit

The life of the entity is divided into series of reporting periods

time period

Information is material if it’s omission or misstatement could influence economi decision

materiality concept

The cost of processing and communicating information should not exceed the benefits to be derived from it

cost benefit

The effects of transaction and other events are recognized when they occur and they are recorded in the accounting records and reported in financial statements of the period which they relate

accrual basis of accounting

The value of an asset is determined on the basis of acquisition cost

historical cost

All of the components of a complete set of financial statements are interrelated

concept of articulation

This principle is recognize that the nature and amount of information included in the financial statement reflect a series of judgemental trade off

full disclosure principle

The financial statements are prepared on the basis of accounting principles that are applied consistently from one period to the next. Changes in accounting policies are made only when required or permitted by the PFRS or when the change result to more relevant and reliable information.

consistency concept

Cost are recognized as expenses when the related revenue is recognized

matching

The accounting objectives is geared towards proper income determination. This theory emphasizes the income statement and is exemplified by the equation Assets = Liabilities + Capital

Entity theory

The accounting objectives is geared towards the proper valuation of asset. This theory emphasizes the importance of balance sheet and is exemplified in the equation of Asset - Liabilities = Capital

Proprietary Theory

This theory is applicable when there are two classes of shares issued - ordinary and preferred

residual equity theory

the accounting objective is neither proper income determination nor proper valuation of assets but the custody and administration of funds.

fund theory

the process of converting non-cash assets into cash or claims for cash. It is also the concept that deals with revenue recognition.

realization

is the use of caution when making estimates under conditions of uncertainty, such that assets or income are not overstated and liabilities or expenses are not understated. In other words, when exercising prudence, the one which has the least effect on equity is chosen.

prudence

costs that are directly related to the earning of revenue are recognized as expenses in the same period the related revenue is recognized.

matching concept

costs that are not directly related to the earning of revenue are initially recognized as assets and recognized as expenses over the periods their economic benefits are consumed, using some method of allocation.

systematic and rational allocation

costs that do not meet the definition of an asset, or ceases to meet the definition of an asset, are expensed immediately. Examples include casualty losses and impairment losses.

immediate recognition

Financial accounting is governed by what?

Philippine Financial Reporting Standards (PFRS).

It is the structured representation of an entity's financial position and results of its operations. They are the end product of the accounting process and the means by which information gathered and processed are periodically communicated to users.

financial statements

includes the financial statements plus other information provided outside the financial statements that assists in the interpretation of a complete set of financial statements or improves users' ability to make efficient economic decisions.

financial report

refers to the accumulation and communication of information for use by internal users or management.

management accounting

It is the systematic recording and analysis of the costs of materials, labor, and overhead incident to production.

cost accounting

It is the process of evaluating the correspondence of certain assertions with established criteria and expressing an opinion thereon.

auditing

the preparation of tax returns and rendering of tax advice, such as the determination of the tax consequences of certain proposed business endeavors.

tax accounting

refers to the accounting for the government and its instrumentalities, placing emphasis on the custody of public funds, the purposes for which those funds are committed, and the responsibility and accountability of the individuals entrusted with those funds.

government accounting

refers to the handling of accounts managed by a person entrusted with the custody and management of property for the benefit of another

fiduciary accounting

refers to the handling of accounts for fiduciaries who wind up the affairs of a deceased person.

estate accounting

the process of communicating the social and environmental effects of an entity's economic actions to the society.

social accounting

the accounting for non-profit entities other than the government.

institutional accounting

the installation of accounting procedures for the accumulation of financial data and designing of accounting forms to be used in data gathering.

accounting systems

pertains to the careful analysis of economic events and other variables to understand their impact on decisions.

accounting research

It involves the rendering of audit or accounting related services to more than one client on a fee basis

practice of public accountancy

refers to employment in the private sector in a position which involves decision making requiring professional knowledge in the science of accounting and such position requires that the holder thereof must be a certified public accountant.

practice in commerce or industry

It is the employment in an educational institution which involves teaching of accounting auditing, management advisory services, finance, business law, taxation, and other technically related subjects.

practice in education/academe

It is the employment or appointment to a position in an accounting professional group in the government or in a government-owned and/or controlled corporation, including those performing proprietary functions, where decision making requires professional knowledge in the science of accounting, or where civil service eligibility as a certified public accountant is a prerequisite.

practice in the government

It is the official accounting standard setting body in the Philippines created under the Philippine Accountancy Act of 2004 (R.A. No. 9298).

Financial and Sustainability Reporting Standards Council (FSRSC)

is a committee formed by the Accounting Standards Council (ASC), the predecessor of FSRSC, with the role of reviewing the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) for approval and adoption by the FSRSC.

Philippine Interpretation Committee

Cfas ( conceptual framework )

ユーザ名非公開 · 15問 · 11ヶ月前

Cfas ( conceptual framework )