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ACCT 105 Exam 1 Questions with Correct Answers
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ACCT 105 Exam 1 Questions with Correct Answers
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ACCT 105 Exam 1 Questions with Correct AnswersWhat is financial accounting? Correct Answer-Providing information
about the financial resources, obligations, and activities of an economic
entity that is intended for use primarily by external decision makers-
investors and creditors
What do accountants do today and why are they important? Correct
Answer-Prepare fin. statements
Tax return preparation
Auditing business records and processes
Cost Savings
Who are the users of accounting information? Correct Answer-Owners
Managers
Creditors
Government Agencies
Who are the users of financial accounting? Correct Answer-external
parties (shareholders, investors, creditors, etc.)
What are the qualities of information? Correct Answer-Relevance and
faithful representation
, What is the FASB Correct Answer-Financial Accounting Standards
Board- responsible for establishing financial reporting standards in US
What is GAAP? Correct Answer-Generally Accepted Accounting
Principles- financial reporting standards
What is the relationship between FASB and GAAP? Correct Answer-
FASB made GAAP
What is the IASB and the IFRS and how are they related? Correct
Answer-International Accounting Standards Board
International Financial reporting standards.
IASB establishes IFRS
Why do we have GAAP? Correct Answer-To ensure comparability and
consistency
What is SEC, and SOX of 2002 and how are they related? Correct
Answer-Securities and Exchange Commission.
SOX created SEC
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