Accounting Week 2 tutorial quiz

What is the primary purpose of general purpose financial statements?

• To provide detailed information for individual stakeholders

• To summarize performance and cash flow for all users

• To assist management in decision-making

• To replace other data for financial analysis

What is the main challenge in catering to the needs of all users with financial statements?

• Inadequate technology for distribution

• Limited space for detailed information

• Diverse information needs of different users

• Lack of expertise among users

Which of the following are 'General Purpose' financial statements

• Statement of Cash Flows

• General Journal

• Trial Balance

• Balance sheet

The Balance Sheet's ​ (a)   links with the Statement of Cash Flows.​

• Cash Balance
• Net Profit
• Equity
• Drawings

What additional components are typically included in a company's Annual Report besides financial statements

• Director's Report

• Corporate Governance Statement

• Investment recommendations

• Independent Auditors Report

This commision monitors company compliance with Accounting Standards and the Corporations Act.

Match the following qualitative characteristics with their definition.

• Complete, Neutral and error free.

• Understandbility

• Reports must use consistent policies.

• Relevance

• Must be helpful to decision making.

• Comparibility

• Information must be clear and concise.

• Timeliness

• Release it before it loses value.

• Faithful Representation

All assets are initially recorded in the accounts at their purchase price or cost is the ​ (a)   ​ ​principle. Faliure to do so is a breach in ​ ​ ​ (b)  

• Faithful representation.
• Historical Cost
• Entity
• Accounting Period
• Understandibility
• Comparibility