Theory of Accounts 1-7

1. The objectives of financial reporting for entities are based on

a. the need for conservatism
b. reporting on management's stewardship
c. generally accepted accounting principles
d. the needs of the users of the information

2. The information provided by financial reporting pertains to

a. individual business entities, rather than to industries or an economy as a whole or to members of society as consumers
b. individual business entities and an economy as a whole or to members of society as consumers or to members of society as consumers
c. individual business entities and an economy as a whole, rather than to industries or to members of society as consumers
d. individual business entities, industries and an economy as a whole, rather than to members of society as consumers

3. During a period when an entity is under the direction of a particular management, financial reporting will directly provide information about

a. both entity performance and management performance
b. management performance but not entity performance
c. entity performance but not management performance
d. neither entity performance nor management performance

4. Which of the following items is not listed as a major objective of financial reporting

a. financial reporting shall provide information about entity resources, claims to those resources and changes in them
b. financial reporting shall provide information useful in evaluating management's stewardship
c. financial reporting shall provide information useful in investment, credit and similar decisions
d. financial reporting shall provide information useful in assessing cash flow projects

5. Which of the following statements is not normally an objective of financial reporting

a. to provide information about an entity's assets and claims against those assets
b. to provide information that is useful in assessing an entity's sources and uses of cash
c. to provide information that is useful in lending and investing decisions
d. to provide information about an entity's liquidation value


Answer:
1. d
2. a
3. c
4. b
5.d

"Questions are lifted from the following sources: PHILCPA, AICPA, ACP, PAS, PFRS, IAS, IFR