FAC1502 EXAM PREP UPDATED ACTUAL EXAM COMPLETE
QUESTIONS WITH DETAILED VERIFIED ANSWERS (100% CORRECT
ANSWERS) /ALREADY GRADED A+
Discuss the nature of accounting. ✓ Refer to paragraph 1.2.2.
Accounting is a specialised means of
communication which is used to convey
a specialised message about an entity's
finances. The recipient of this
specialised message (the user of
financial information) must understand it
otherwise the information that is
conveyed has no value.
Accounting uses words and figures to
convey financial information to the users
of such information. As you progress
with your study of accounting you will
, become familiar with the meaning of
these words and figures, which are also
known as the concepts, principles and
procedures of accounting. This
knowledge will ultimately help you
understand the message contained in
financial statements.
Each and every person who is involved
in an entity uses financial information to
a greater or lesser degree. Each of us
also needs to know something about
accounting to manage our personal
financial affairs. Financial resources are
limited or scarce, and if we are going to
spend them we must plan properly.
Knowledge of accounting is therefore
also useful in this area. Accounting is
therefore a ''language'' used to convey
financial information to interested
parties
What is the common unit of ✓ The common unit of measurement in
measurement in accounting? accounting is money.
,Name the four main forms of ✓ Sole trader
ownership. Partnership
Close Corporation
Company
Discuss the different users of financial ✓ See section 1.5.
information.
Financial information is required by
many users, who analyse the
information for various decision-making
purposes. The following are the most
common users of this information:
Investors
Employees
Lenders
Suppliers and other trade creditors
Customers
Government and their agencies
Public
Differentiate between financial ✓ See section 1.6.
accounting and management
accounting. Users of financial information can be
subdivided into the following two
categories:
, internal users - for example,
management and employees
external users - for example, investors,
creditors and government
Two fields of accounting have
developed as a result of this distinction
between the users of the information.
Financial accounting is concerned with
the provision of financial information to
mainly external parties, while
management accounting is concerned
with the provision of financial
information to people within the entity.
Financial accounting This field of
accounting is concerned with recording
transactions and preparing the financial
statements for the entity as a whole.
Financial accounting is governed by
international financial reporting
standards (IFRS), which consists of
external standards which must be
QUESTIONS WITH DETAILED VERIFIED ANSWERS (100% CORRECT
ANSWERS) /ALREADY GRADED A+
Discuss the nature of accounting. ✓ Refer to paragraph 1.2.2.
Accounting is a specialised means of
communication which is used to convey
a specialised message about an entity's
finances. The recipient of this
specialised message (the user of
financial information) must understand it
otherwise the information that is
conveyed has no value.
Accounting uses words and figures to
convey financial information to the users
of such information. As you progress
with your study of accounting you will
, become familiar with the meaning of
these words and figures, which are also
known as the concepts, principles and
procedures of accounting. This
knowledge will ultimately help you
understand the message contained in
financial statements.
Each and every person who is involved
in an entity uses financial information to
a greater or lesser degree. Each of us
also needs to know something about
accounting to manage our personal
financial affairs. Financial resources are
limited or scarce, and if we are going to
spend them we must plan properly.
Knowledge of accounting is therefore
also useful in this area. Accounting is
therefore a ''language'' used to convey
financial information to interested
parties
What is the common unit of ✓ The common unit of measurement in
measurement in accounting? accounting is money.
,Name the four main forms of ✓ Sole trader
ownership. Partnership
Close Corporation
Company
Discuss the different users of financial ✓ See section 1.5.
information.
Financial information is required by
many users, who analyse the
information for various decision-making
purposes. The following are the most
common users of this information:
Investors
Employees
Lenders
Suppliers and other trade creditors
Customers
Government and their agencies
Public
Differentiate between financial ✓ See section 1.6.
accounting and management
accounting. Users of financial information can be
subdivided into the following two
categories:
, internal users - for example,
management and employees
external users - for example, investors,
creditors and government
Two fields of accounting have
developed as a result of this distinction
between the users of the information.
Financial accounting is concerned with
the provision of financial information to
mainly external parties, while
management accounting is concerned
with the provision of financial
information to people within the entity.
Financial accounting This field of
accounting is concerned with recording
transactions and preparing the financial
statements for the entity as a whole.
Financial accounting is governed by
international financial reporting
standards (IFRS), which consists of
external standards which must be
