FINANCE_AND_ACCOUNTING_EXAM_MARCH_5.docx - FINANCE AND ACCOUNTING EXAM MARCH 5 Question options 1 What kind of objects has been used as money during the

FINANCE_AND_ACCOUNTING_EXAM_MARCH_5.docx - FINANCE AND...

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FINANCE AND ACCOUNTING EXAM MARCH 5 Question options: 1. What kind of objects has been used as money during the history ? wooden tallies, Paper money, Precious mental, Dried fish, gold dust, cocoa beans, tobacco tulip mania, shell, cheque, banknotes, horse, 2. The main principles of Financial statements Financial statements are prepared on the accrual basis of accounting so that the effects of transactions and other events are recognized when they occur (and not as cash or cash equivalents are received or paid) The financial statements are prepared on the assumption that the enterprise is a going concern and will continue in operation for the foreseeable future Information is relevant to the decision-making needs of users when it influences the economic decisions of users by helping them evaluate past, present or future events or conforming, or correcting, their past evaluations. The relevance of information is affected by its nature and materiality Information is reliable when it is free from material error or bias. It should represent faithfully the transactions or other events that it purports to represent or could reasonably be expected to represent. This means that transactions and other events are accounted for and presented in accordance with their substance and economic reality and not merely their legal form The measurement and display of the financial effect of like transactions and other events must be carried out in a consistent way throughout an enterprise and over time for that enterprise and in a consistent way for different enterprises Assets and liabilities are recognized when it is probable that the associated economic benefits will flow to or from the enterprise and the asset or liability can be measured reliably Financial statements are generally prepared using a financial capital maintenance concept under which a profit is earned only if the money amount of net assets at the end of the
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  • Fall '19
  • Balance Sheet, Generally Accepted Accounting Principles

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