2. Exam Paper for Financial Accounting in BBA

,Exam Paper for Financial Accounting in BBA

PAPER # 1


**Instructions:**


* Answer all questions.
* Show your work whenever possible.
* Write your answers in the space provided.


**Question 1:**


What is the purpose of financial accounting?


**Answer:**


The purpose of financial accounting is to provide information about the
financial position, performance, and changes in financial position of an
entity to users of financial statements.


**Question 2:**


What are the three main financial statements?


**Answer:**


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, The three main financial statements are the balance sheet, income
statement, and statement of cash flows.


* The balance sheet shows the assets, liabilities, and equity of an entity at a
specific point in time.
* The income statement shows the revenues, expenses, and profits or losses
of an entity for a specific period of time.
* The statement of cash flows shows the cash inflows and outflows of an
entity for a specific period of time.


**Question 3:**


What are the two main types of assets?


**Answer:**


The two main types of assets are current assets and non-current assets.


* Current assets are assets that are expected to be converted into cash or
used up within one year. Examples of current assets include cash, accounts
receivable, inventory, and prepaid expenses.
* Non-current assets are assets that are expected to be used up over a
period of more than one year. Examples of non-current assets include
property, plant, and equipment, investments, and intangible assets.


**Question 4:**




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