Fundamentals of Accountancy Quiz

Which of the following best defines accounting?

• The process of managing employees in a company

• The systematic process of identifying, measuring, recording, and communicating financial information

• The process of selling goods and services to customers

• The creation of business plans for startups

Why is accounting often referred to as the "language of business"?

• It uses symbols and numbers to describe business activities

• It translates financial data into understandable business information

• It is only understood by accountants and financial professionals

• It focuses on learning different business languages

Which of the following is the main focus of Cost Accounting?

• Analyzing the costs of products or services

• Teaching accounting principles

• Preparing financial statements

• Filing tax returns

Who is known as the "Father of Accounting and Bookkeeping"?

• Adam Smith

• Luca Pacioli

• Karl Marx

• John Maynard Keynes

Which branch of accounting is responsible for auditing financial statements and issuing an Independent Auditor's Report for businesses with quarterly revenues over ₱150,000?

• Auditing

• Financial Accounting

• Government Accounting

• Management Accounting

What is the significance of the double-entry system?

• It allowed transactions to be recorded in two different books

• It ensured that every transaction affects at least two accounts

• It made accounting easier by removing the need for records

• It helped businesses hide financial transactions

Which accounting principle states that businesses should continue operating indefinitely unless there is evidence to the contrary?

• Accrual Principle

• Going Concern Principle

• Business Entity Principle

• Matching Principle

Which principle requires businesses to record transactions at their original purchase price?

• Cost Principle

• Accrual Principle

• Matching Principle

• Objectivity Principle

The Monetary Unit Principle requires that:

• Transactions should only be recorded if they can be measured in money

• The business should separate personal and company transactions

• Revenue should be recorded when earned, regardless of cash receipt

• Business transactions should match revenues with related expenses

Under the Matching Principle, expenses should be recorded:

• When they are paid

• At the end of the accounting period

• When the related revenue is earned

• When the company has enough cash