FABM2 Review 1

This process involves the recognition or non-recognition of business activities or transactions as accountable events.

• Identifying

• Measuring

• Recording

• Classifying

Which of the following correctly describes accounting?

• The function of accounting is to provide quantitative information about economic entities that 

  is intended to be useful in making economic decisions.

• Accounting is the process of identifying, measuring, and communicating economic information to permit informed judgments and decisions by users of the information.

• Accounting is the art of recording, classifying, and summarizing in a significant manner and in terms of money, transactions and events which are of financial character and interpreting the results thereof.

• All of these correctly describe accounting.

Statement 1: Accounting is the major facet of a business responsible for generating funds needed

    to support the operations.

    Statement 2: The main purpose of accounting is to provide useful information in making economic decisions.

• Both statements are true.

• Both statements are false. 

• Only the first statement is true.

• Only the second statement is true.

Which of the following are considered as accountable events?

I. Payment of employee salaries and wages.

II. Death of company CEO. 

III. A company signed an agreement to provide services to a client for 3 years.

IV. Sale of company products to a customer.

• I and III

• 1 and IV

• II and III

• I,III and IV

This process involves assigning amounts to accountable economic events and transactions.

• Identifying

• Measuring

• Assigning

• Recording

The accredited professional organization of CPAS in the Philippines is the:

• Financial Reporting Standards Council.

• Philippine Institute of Certified Public Accountants.

• Board of Accountancy.

• Philippine Professional Organization of Certified Public Accountants.

Alexandria, a CPA, is employed in BCV Enterprises as the company's chief accountant. In this case, Alexandria is practicing her profession under what scope?

• Public Accountancy

• Commerce and Industry

• Academe

• Goverment

Brian, a CPA, is employed in an educational institution as the institution's payroll manager. In this case, Brian is practicing his profession under what scope?

• Public Accountancy

• Commerce and Industry

• Academe

• Government

This field of practice involves the teaching of accounting, auditing, management services, finance, business law, taxation, and other technically related subjects.

• Public Accountancy

• Commerce and Industry

• Academe

• Government

Qualitative characteristics of useful financial information

• are the qualities or attributes that make financial Information useful to the users in making 

  economic decisions.

• contribute to the decision-usefulness of financial information.

• are classified either as

  fundamental or enhancing.

• all are correct.