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Accounting questions: internal users of accounting data, providing relevant data, monetary unit assumption, account debited/credited and more!

2. Identify and describe the steps in the accounting process.

3. (a) Who are internal users of accounting data?
(b) How does accounting provide relevant data to these users?

7. What is the monetary unit assumption? What impact does inflation have on the monetary unit assumption?

29. For the following transactions, indicate the account debited and the account credited.
(a) Supplies are purchased on account.
(b) Cash is received on signing a note payable.
(c) Employees are paid salaries in cash.

32. What are the advantages of using the journal in the recording process?

42. (a) What are generally accepted accounting principles (GAAP)? (b) What bodies provide authoritative support for GAAP?

44. (a) What are the objectives of financial reporting? (b) Identify the qualitative characteristics of accounting information.

Solution Preview

2. Identify and describe the steps in the accounting process.

the steps in the accounting process including
- Identify the transaction or other recognizable event.
- Prepare the transaction's source document such as a purchase order or invoice.
- Analyze and classify the transaction. This step involves quantifying the
- transaction in monetary terms (e.g. dollars and cents), identifying the
- accounts that are affected and whether those accounts are to be debited or
- credited.
- Record the transaction by making entries in the appropriate journal, such as
- the sales journal, purchase journal, cash receipt or disbursement journal, or
- the general journal. Such entries are made in chronological order.
- Post general journal entries to the ledger accounts.

3. (a) Who are internal users of accounting data?

- the users of accounting data inside the company are called internal users, including management, board of directors.

(b) How does accounting provide to these users?
To ...

Solution Summary

Here is just a sample of what you'll find in this solution:

"To provide the internal users with the relevant data, accountants reports financial statements, including balance sheet, income statement, statement of cash flows. Therefore, accountants participate in planning, evaluating, and controlling the activities of the firm."

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