ACCT 253 intro test questions and answers 2024

Accounting - an information system that identifies, measures, records and communicates understandable, relevant, reliable, and comparable information about an organization's economic activities. bookkeeping - the recording of financial transactions, either manually or electronically, for the purpose of creating a reliable bank of data. 3 kinds of business - 1. Sole proprietorship - subject to unlimited liability 2. Partnership 3. Corporation unlimited liability - owner is responsible for debts that are greater than the resources of the proprietorship. limited partnership - general partner(s) with unlimited liability and a limited partner(s) with liability restricted to the amount invested limited liability partnership - restricts partners' liabilities to their own acts thus protecting innocent partners from the negligence of another partner corporation - owned by : shareholders - legally distinct from business by limited liability Non-business organizations include - airports, libraries, museums, religious institutions, municipal governments, law enforcement organizations, postal services, colleges, universities, bus lines, utilities, highways, shelters, parks, hospitals, and schools. ANYTHING WHERE PROFIT IS NOT THE PRIMARY GOAL Financial Accounting serves - External Users: bd clss - (bad class) brokers, directors, customers, lenders, suppliers, shareholders Managerial Accounting serves - Internal Users: Internal controls are procedures set up to ... - PEPE 1. Protect assets (cash, equipment, and buildings), 2. Ensure that accounting reports are reliable, 3. Promote efficiency 4. Ensure that company policies are followed Ethically Accountants must be... - 1. Competent 2. Confidential 3. Integrity 4. Objective in matters of financial disclosure. Why are internal controls important? - they protect assets, ensure reliability, promote efficiency, and are crucial if accounting reports are to be relevant and reliable. What are the guidelines for ethical and socially responsible decisions are threefold: - (1) Identify ethical and/or social issue; (2) Analyze options, both good and bad for all individuals affected; (3) Decide ethically - the best socially responsible option after weighing all consequences Why are ethics and social responsibility valuable to organizations? - without them, existence is more difficult, inefficient, and unpleasant. They often translate into higher profits and a better working environment. Why are ethics crucial to accounting? - For information to be useful, it must be trusted. Trustworthiness of information demands ethics Accountants work in four general fields: - 1. Financial 2. Managerial 3. Taxation 4. Accounting-related Canadian Accounting designations - (CGA) Certified General Accountant (CMA) Certified Management Accountant (CA) Chartered Accountant 3 types of accountants - 1 private accountants and work for a single employer, which is often a business. 2 public accountants are available to the public, which means that services are provided to many different clients. 3 Government accountants Financial accounting comes after a - audit 5 facets of managerial accounting - 1 general accounting 2. cost accounting