For help mail.
NACC103: CONCEPTUAL
FRAMEWORK AND
ACCOUNTING STANDARDS
EXAM WITH VERIFIED
ANSWERS 2023-2024
,For help mail.
ACC103: CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS
FRAMEWORK OF ACCOUNTING
I-ACCOUNTING AND ACCOUNTANCY PROFESSION
1. Which accounting process is the recognition or nonrecognition of business
activities as accountable events?
(a) identifying (b) measuring (c )communicating (d) summarizing
2. These are events that affect the enterprise and in which other entities participate.
External Internal External Internal
(a) Yes Yes c) No No
(b) Yes No d) No Yes
3. Which is an internal event?
(a) Casualty loss
(b) Exchange
(c) Nonreciprocal transfer between the enterprise and its owners.
(d) Nonreciprocal transfer between the enterprise and other entities
4. The basic purpose of accounting is:
(a) to measure periodic income of the economic entity.
(b) to provide quantitative financial information about a business enterprise that is
useful in making rational economic decision
(c) to provide information that the creditors of an economic entity can use in
deciding whether to make additional loans to the entity.
(d) to provide information that the managers of an economic entity need to
control its operatians.
5. It focuses on general purpose reports on financial position, performance and cash flows.
(a) financial accounting (c)management advisory services
(b) managerial accounting (d) auditing
6. Which area of public accounting means the examination of financial statements by a
CPA for the purpose of expressing an opinion as to the fairness of the statements?
a) external auditing (c) management advisory services
(b) taxation (d) internal auditing
7. Many accountants are employed in business enterprises in various capacities as
accounting staff, chief accountant or controller. These accountants are said to be
engaged in:
(a) public accounting (c) government accounting
(b) financial accounting (d) private accounting
8. They encompass the conventions, rules, and procedures necessary to define
what is accepted accounting practice.
(a) generally accepted accounting principles (c) characteristics principles
(b) accounting assumptions (d) recognition principles
1
,For help mail.
ACC103: CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS
9. One of the basic features of financial accounting is the:
(a) direct measurement of economic resources and obligations and changes
in them in terms of money and sociological and psychological impact.
(b) direct measurement of economic resources and obligations and changes
in them in terms of money.
(c) direct measurement of economic resources and obligations and changes
in them in terms of money and sociological impact.
(d) direct measurement of economic resources and obligations and changes
in them in terms of money and psychological impact.
10. Which is not part of the accounting standard setting process in the Philippines?
(a) preparation and approval by a Task Force of a draft of the proposed SFASS
(b) distribution of the exposure draft for comment to PICPA members, FINEX
members and other interested parties
(c) publication in the Official Gazette or in a newspaper of general circulation
(d) approval by the Professional Regulation Commission
11.It is an independent private sector body with the objective of achieving uniformity
in the accounting principles which are used by business enterprises for financial
reporting around the world.
(a) International Accounting Standards Committee
(b) International Federation of Accountants
(c) Financial Accounting Standards Council
(d) Securities and Exchange Commission
12. The ASC decided to move totally to International Accounting Standards by
reason of (choose the incorrect one):
(a) support of IASC standards by Philippine organizations such as SEC,
Board of Accountancy and PICPA
(b) increasing internationalization of business which has heightened interest in a
common language for financial reporting
(c) increasing recognition of IASC standards by the World Bank, Asian
Development Bank and World Trade Organization
(d) extreme pressure from the International Monetary Fund
13. Which of the following statements regarding International Accounting Standards is
not true?
(a) The purpose of IASC is to reduce the diversity of practices in financial
reporting among countries.
(b) Harmonization of international accounting standards will provide benefits
to both preparers and users of financial statements.
(c) As international trade and ownership barriers are removed, the need for
harmonization international accounting standards will decrease.
(d) Since difference countries use financial statements for different purposes,
some countries will likely not adopt the international accounting standards.
2
, For help mail.
ACC103: CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS
14. The purpose of International Accounting Standards is to
(a) issue enforceable standards which regulate the financial accounting and
reporting of multinational corporations.
(b) develop a uniform currency in which the financial transactions of companies
throughout the world would be measured.
(c) promote uniform accounting standards among countries of the world.
(d) arbitrate accounting disputes between auditors and inter national companies.
15. Financial accounting is concerned with:
(a) general-purpose reports on financial position and results of operations
(b) specialized reports for inventory management and control
(c) specialized reports for income tax computation and recognition
(d) general purpose reports on changes in stock prices and future estimates
of market position
16. Which of the following is not an important characteristic or limitation of the
financial statements that accountants currently prepare?
(a) the information in financial statements is expressed in units of money
adjusted for changing purchasing power
(b) financial statements articulate with one another because measuring financial
position is related to measuring changes in financial position
(c) the information in financial statements is summarized and classified to held meet users needs
(d) financial statements can be justified only if the benefits they provide exceed the costs
17. The branch of accounting that is concerned primarily with providing information
for internal users is called:
(a) audiing (c) financial accounting
(b) managerial accounting (d) income tax accounting
18. Financial accounting can be broadly defined as the area of accounting that prepares:
(a) general purpose financial statements to be used by parties internal to the
business enterprise only
(b) financial statements to be used by investors only
(c)general purpose financial statements to be used by parties both internal and
external to the business enterprise
(d) financial statements to be used primarily by management
19. The primary focus of financial accounting has been on meeting the needs of
which of the following groups?
(a) managers of an enterprise
(b) present and potential creditors of an enterprise
(c) national, and local taxing authorities
(d) independent auditors
20. The most appropriate equation for portraying the relationship of assets, liabilities,
and owners' equity of a corporation is:
(a) assets-liabilities = owners' equity (c) assets=restriction of assets
(b) assets= liabilities + owners' equity (d) liabilities= assets-owners equity
3
NACC103: CONCEPTUAL
FRAMEWORK AND
ACCOUNTING STANDARDS
EXAM WITH VERIFIED
ANSWERS 2023-2024
,For help mail.
ACC103: CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS
FRAMEWORK OF ACCOUNTING
I-ACCOUNTING AND ACCOUNTANCY PROFESSION
1. Which accounting process is the recognition or nonrecognition of business
activities as accountable events?
(a) identifying (b) measuring (c )communicating (d) summarizing
2. These are events that affect the enterprise and in which other entities participate.
External Internal External Internal
(a) Yes Yes c) No No
(b) Yes No d) No Yes
3. Which is an internal event?
(a) Casualty loss
(b) Exchange
(c) Nonreciprocal transfer between the enterprise and its owners.
(d) Nonreciprocal transfer between the enterprise and other entities
4. The basic purpose of accounting is:
(a) to measure periodic income of the economic entity.
(b) to provide quantitative financial information about a business enterprise that is
useful in making rational economic decision
(c) to provide information that the creditors of an economic entity can use in
deciding whether to make additional loans to the entity.
(d) to provide information that the managers of an economic entity need to
control its operatians.
5. It focuses on general purpose reports on financial position, performance and cash flows.
(a) financial accounting (c)management advisory services
(b) managerial accounting (d) auditing
6. Which area of public accounting means the examination of financial statements by a
CPA for the purpose of expressing an opinion as to the fairness of the statements?
a) external auditing (c) management advisory services
(b) taxation (d) internal auditing
7. Many accountants are employed in business enterprises in various capacities as
accounting staff, chief accountant or controller. These accountants are said to be
engaged in:
(a) public accounting (c) government accounting
(b) financial accounting (d) private accounting
8. They encompass the conventions, rules, and procedures necessary to define
what is accepted accounting practice.
(a) generally accepted accounting principles (c) characteristics principles
(b) accounting assumptions (d) recognition principles
1
,For help mail.
ACC103: CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS
9. One of the basic features of financial accounting is the:
(a) direct measurement of economic resources and obligations and changes
in them in terms of money and sociological and psychological impact.
(b) direct measurement of economic resources and obligations and changes
in them in terms of money.
(c) direct measurement of economic resources and obligations and changes
in them in terms of money and sociological impact.
(d) direct measurement of economic resources and obligations and changes
in them in terms of money and psychological impact.
10. Which is not part of the accounting standard setting process in the Philippines?
(a) preparation and approval by a Task Force of a draft of the proposed SFASS
(b) distribution of the exposure draft for comment to PICPA members, FINEX
members and other interested parties
(c) publication in the Official Gazette or in a newspaper of general circulation
(d) approval by the Professional Regulation Commission
11.It is an independent private sector body with the objective of achieving uniformity
in the accounting principles which are used by business enterprises for financial
reporting around the world.
(a) International Accounting Standards Committee
(b) International Federation of Accountants
(c) Financial Accounting Standards Council
(d) Securities and Exchange Commission
12. The ASC decided to move totally to International Accounting Standards by
reason of (choose the incorrect one):
(a) support of IASC standards by Philippine organizations such as SEC,
Board of Accountancy and PICPA
(b) increasing internationalization of business which has heightened interest in a
common language for financial reporting
(c) increasing recognition of IASC standards by the World Bank, Asian
Development Bank and World Trade Organization
(d) extreme pressure from the International Monetary Fund
13. Which of the following statements regarding International Accounting Standards is
not true?
(a) The purpose of IASC is to reduce the diversity of practices in financial
reporting among countries.
(b) Harmonization of international accounting standards will provide benefits
to both preparers and users of financial statements.
(c) As international trade and ownership barriers are removed, the need for
harmonization international accounting standards will decrease.
(d) Since difference countries use financial statements for different purposes,
some countries will likely not adopt the international accounting standards.
2
, For help mail.
ACC103: CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS
14. The purpose of International Accounting Standards is to
(a) issue enforceable standards which regulate the financial accounting and
reporting of multinational corporations.
(b) develop a uniform currency in which the financial transactions of companies
throughout the world would be measured.
(c) promote uniform accounting standards among countries of the world.
(d) arbitrate accounting disputes between auditors and inter national companies.
15. Financial accounting is concerned with:
(a) general-purpose reports on financial position and results of operations
(b) specialized reports for inventory management and control
(c) specialized reports for income tax computation and recognition
(d) general purpose reports on changes in stock prices and future estimates
of market position
16. Which of the following is not an important characteristic or limitation of the
financial statements that accountants currently prepare?
(a) the information in financial statements is expressed in units of money
adjusted for changing purchasing power
(b) financial statements articulate with one another because measuring financial
position is related to measuring changes in financial position
(c) the information in financial statements is summarized and classified to held meet users needs
(d) financial statements can be justified only if the benefits they provide exceed the costs
17. The branch of accounting that is concerned primarily with providing information
for internal users is called:
(a) audiing (c) financial accounting
(b) managerial accounting (d) income tax accounting
18. Financial accounting can be broadly defined as the area of accounting that prepares:
(a) general purpose financial statements to be used by parties internal to the
business enterprise only
(b) financial statements to be used by investors only
(c)general purpose financial statements to be used by parties both internal and
external to the business enterprise
(d) financial statements to be used primarily by management
19. The primary focus of financial accounting has been on meeting the needs of
which of the following groups?
(a) managers of an enterprise
(b) present and potential creditors of an enterprise
(c) national, and local taxing authorities
(d) independent auditors
20. The most appropriate equation for portraying the relationship of assets, liabilities,
and owners' equity of a corporation is:
(a) assets-liabilities = owners' equity (c) assets=restriction of assets
(b) assets= liabilities + owners' equity (d) liabilities= assets-owners equity
3
