MANAGENT ACCOUNTING Question And Answers
- What is money measurement concept?
Answer:- The money measurement concept states that a business should only record an accounting transaction if it can be expressed in terms of money.
- List the accounting conventions.
Answer:- Accounting conventions are conservatism, consistency, full disclosure and materiality.
- What is convention of disclosure?
Answer:- The full disclosure principle requires a company to provide the necessary information so that people who are accustomed to reading financial information are able to make informed decisions regarding the company.
- What are financial statements?
Answer:- The primary financial statements are: the profit and loss statement, balance sheet and statement of cash flow.
- What is a balance sheet?
Answer:- A balance sheet is a statement of the financial position of a business which states the assets, liabilities and owner’s equity at a particular point in time.
- What is a profit and loss account?
Answer:- The profit and loss (P&L) statement is a financial statement that summarizes the revenues, costs and expenses incurred during a specified period, usually a fiscal
quarter or year.
- What is trend analysis?
Answer:- Trend analysis is a technique used in technical analysis that attempts to predict the future stock price movements based on recently observed trenddata. Trend
analysis is based on the idea that what has happened in the past gives traders an idea of what will happen in the future.
- Mention any two financial statements.
Answer:- The financial statements are: the profit and loss statement, balance sheet and statement of cash flow.
- Mention the tools used in financial statement analysis.
Answer:- Comparative Financial Statement Analysis (Horizontal Analysis),Common-size Financial Statement Analysis (Vertical Analysis), Ratio Analysis,Trend Analysis,Regression Analysis.
- What is a ratio?
Answer:- A ratio compares values. A ratio expresses how much of one thing there is compared to another thing
