BU 127 EXAM QUESTIONS AND
CORRECT ANSWERS. VERIFIED
2025/2026.
Financial accounting reports - ANS Periodic financial statements and related disclosures
provided to external decision makers.
(creditors, investors)
Managerial accounting reports - ANS include detailed financial plans and continually updated
reports about the operating performance of the company
(Managers)
Statement of financial position - ANS reports the economic resources it owns and the sources
of financing for those resources.
Statement of earnings - ANS (the main component of the statement of comprehensive
income):
reports its ability to sell goods for more than their cost to acquire and sell.
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Statement of changes in equity: - ANS reports additional contributions from or payments to
shareholders, and the amount of earnings the company reinvested for future growth
Statement of cash flows - ANS reports its ability to generate cash and how it was used -
(operating, investing (long-term assets) financing — debt or equity)
purpose of the statement of financial position (balance sheet) - ANS to report the financial
position (amount of assets, liabilities, and shareholders' equity) of an accounting entity at a
particular point in time.
heading of the statement of financial position identifies four significant items related to the
statement - ANS 1. Name of the accounting entity
2. Title of the statement
3. Specific date of the statement
4. Unit of measure
accounting entity - ANS organization for which financial data are to be collected and reported
Statement of financial position has three major captions - ANS 1: assets,
2: liabilities, and
3: shareholders' equity
assets (what the company owns) - ANS = liabilities + shareholder equity (what company owes
to shareholders and creditors)
Assets - ANS Economic resources controlled by the entity as a result of past business events
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
CORRECT ANSWERS. VERIFIED
2025/2026.
Financial accounting reports - ANS Periodic financial statements and related disclosures
provided to external decision makers.
(creditors, investors)
Managerial accounting reports - ANS include detailed financial plans and continually updated
reports about the operating performance of the company
(Managers)
Statement of financial position - ANS reports the economic resources it owns and the sources
of financing for those resources.
Statement of earnings - ANS (the main component of the statement of comprehensive
income):
reports its ability to sell goods for more than their cost to acquire and sell.
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Statement of changes in equity: - ANS reports additional contributions from or payments to
shareholders, and the amount of earnings the company reinvested for future growth
Statement of cash flows - ANS reports its ability to generate cash and how it was used -
(operating, investing (long-term assets) financing — debt or equity)
purpose of the statement of financial position (balance sheet) - ANS to report the financial
position (amount of assets, liabilities, and shareholders' equity) of an accounting entity at a
particular point in time.
heading of the statement of financial position identifies four significant items related to the
statement - ANS 1. Name of the accounting entity
2. Title of the statement
3. Specific date of the statement
4. Unit of measure
accounting entity - ANS organization for which financial data are to be collected and reported
Statement of financial position has three major captions - ANS 1: assets,
2: liabilities, and
3: shareholders' equity
assets (what the company owns) - ANS = liabilities + shareholder equity (what company owes
to shareholders and creditors)
Assets - ANS Economic resources controlled by the entity as a result of past business events
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
