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Accounting
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23 Nov 2019

Give short answers to the following questions: (15)
i. What is a 'dual aspect concept'?
ii. What do you understand by the term 'convention ofmateriality'?
iii. What is accounting equation?
iv. What does GAAP stand for?
v. What you understand by the following terms?
? Liabilities
? Assets
? Revenue

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Patrina Schowalter
Patrina SchowalterLv2
22 Feb 2019
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Related questions

Give short answers to the following questions: (16)
i. Who is an accountant?
ii. Describe various roles and activities that accountantsperform.
iii. What type of duties does a controller perform?
iv. What is a double entry system? Outline the steps involved inDouble entry system.
v. What is the meaning of ‘Debit’ and ‘Credit’ in accounting?
vi. What is meant by ‘Hybrid basis’ accounting? How the entries arerecorded using this method?
vii. What is the difference between ‘Real Accounts’ and ‘PersonalAccounts’?
viii. How do we record the entries using cash basis accountingmethod

Quest. 1

The management of Star processing company Ltd has met to reviewlast year's financial statements and use it as the basis for theactivities of this year. After the presentation by the financialcontroller, the chief executive officer who was the chairman ofmeeting retorted that the financial statements are for theconsumption of the management and employees of the company.Assuming you were the marketing manager for this company andpresent at the meeting.

Required: a)State the other parties interested in the financialstatements and identify one(1) user need for each interestedparty.

Quest. 2

The observation of the following concepts is presumed infinancial statement unless otherwise stated

(i). Going concern concept

(ii). Accruals concept

(iii). Business entity concept (iv). Prudence concept

(v). Historical cost concept Required:

a. Explain each of the above concept giving examples of how eachis observed in the conventional financial statement.

b. Give or list two drawbacks of each of the above concept.

c. Name and explain briefly the four qualitative characteristicsof accounting information that make financial statements useful tousers.

You are requested to deliver your auditors report personally to the board of directors of Sebal Manufacturing Corporation and answer questions posed about the financial statements. While reading the statements, one director asks, what are the precise meaning of the terms cost, expenses, and loss? These terms sometimes seem to identify similar items and other times seem to identify similar items and other times seem to identify dissimilar items.
Required
a. Explain the meaning of (1) cost, (2) expense, and (3) loss as used for financial reporting in conformity with generally accepted accounting principles. In your explanation discuss the distinguishing characteristics of the terms and their similarities and interrelationships.
b. Classify each of the following items as a cost, expense, loss or other category, and explain how the classification of each item may change:
i.
Cost of goods sold ii. Bad debts expense iii. Depreciation expense for plant machinery iv. Organization costs v. Spoiled goods
a. The terms period cost and product cost are sometimes used to describe certain items in financial statements. Define these terms and distinguish between them. To what types does each apply.

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