1.Which of the following statements are true?
1.Accounting can be described as the recording and summarising of transactions.
2.Financial accounting describes the production of a statement of financial position and statement of profit or loss for internal use.
C.Both 1 and 2
Accounting involves recording transactions as they occur and then summarising them in the form of the financial statements.
Financial account ing describes the production of accounts for external use.
2.The main aim of financial accounting is to:
A.record all transactions in the books of account
B.provide management with detailed analyses of costs
C.present the financial results to the organisation by means of recognised statements
3.Which one of the following sentences does NOT explain the distinction between financial accounts and management accounts?
A.Financial accounts are primarily for external users and management accounts are primarily for internal users
B.Financial accounts are normally produced annually and management accounts are normally produced monthly
C.Financial accounts are more accurate than management accounts
D.Financial accounts are audited by an external auditor and management accounts do not normally have an external audit
Both financial and management accounts are equally accurate.
4.The following information relates to Minnie's hairdressing business in the year ended 31 August 20X7:
Opening inventory 1,500
Closing inventory 900
Gross profit 12,950
Inventory drawings of shampoo 75
What is the sales figure for the business?