Financial Accounting TFQ

Management accounting refers to the preparation and use of accounting information designed to meet the needs of decision makers outside the business organization.

• True

• False

External users of accounting information have a financial interest in an entity but are not involved with the day-to-day operations of the enterprise.

• True

• False

The statement of financial position and the income statement are one and the same.

• True

• False

The tax return is one of the primary financial statements.

• True

• False

The going concern principle assumes that the business is a continuing enterprise.

• True

• False

A profit results from having more revenues than liabilities.

• True

• False

Total assets plus total liabilities equals total equity.

• True

• False

The entity principle states that the affairs of the owners are not part of the financial operations of a business entity and should be separated.

• True

• False

A credit to a ledger account refers to the entry of an amount on the right side of an account.

• True

• False

An increase in a liability is recorded by a credit; an increase in equity by a debit.

• True

• False