INTROACC: PRELIM SUMMARY QUIZ

The assumption that in the absence of contrary information a business entity will continue indefinitely is the:

• Periodicity assumption.

• Entity assumption.

• Going concern assumption.

• Historical cost assumption

Owners of business firms are the only people who need accounting information.

The hiring of a new company president is an economic event recorded by the financial information system.

Management of a business enterprise is the major external user of information.

Accounting communicates financial information about a business enterprise to both internal and external users.

Financial statements are the major means of communicating accounting information to interested parties.

The origins of accounting are attributed to Luca Pacioli, a famous mathematician.

A partnership must have more than one owner.

The economic entity assumption requires that the activities of an entity be kept separate and distinct from the activities of its owner and all other economic entities.

The monetary unit assumption states that transactions that can be measured in terms of money should be recorded in the accounting records.