Page 15 - DCOM101_FINANCIAL_ACCOUNTING_I
P. 15

Unit 1: Introduction to Accounting




          1.10 Self Assessment                                                                  Notes

          Fill in the blanks:

          1.   The users of accounting are ………………… and external.
          2.   Accounting records all the transactions which can be expressed either in ………………… .
          3.   The creditors are interested to know the ………………… of the business.
          4.   The main purpose of ………………… and accounting is to furnish the necessary fi nancial
               data to the persons interested in the business.
          5.   ……………… refers to the recording of daily business fi nancial transaction.
          6.   The accounting which provides the necessary information to the management is called
               ……………… .
          7.   Accounting records all the transactions which can be expressed either in ………………… .
          8.   Every financial transaction of the business has ………………… and recorded at two

               places.
          9.   ………………… enables the comparison of the profit or performance of a business in a year

               with the performance of another year.
          State whether the following statements are true or false:


          10.  Exact profit can be ascertained with the help of fi nancial accounting.

          11.   Balance sheet is the reflector of the financial position of a business.

          12.   The objective of the accounting is to only recording of the financial transactions of the


               business and determination of profit or loss.
          13.  The profits are calculated with the help of management accounting.

          14.   Financial statements provide information relating to operational results as well as fi nancial
               position of the business.
          1.11 Review Questions


          1.   “Accounting is the process of recording, classifying and summarizing of accounting
               transactions.” Explain.
          2.   What are the key internal and external users of accounting information?

          3.   State the key branches of accounting.
          4.   Is there any differences between book keeping and accounting?

          5.    Why creditors are interested in financial records of the business?
          6.    Discuss the scope of responsibility accounting.

          7.   State the differences between cost accounting and management accounting.
          Answers: Self Assessment


          1.   internal                          2.   money or money’s worth
          3.   solvency                          4.  book-keeping
          5.   Financial accounting              6.  management accounting




                                           LOVELY PROFESSIONAL UNIVERSITY                                     9
   10   11   12   13   14   15   16   17   18   19   20