1. Which of the following is an accounting principle? a) Market Value b) Entity c) Subjectivity d) Business Ethics 2. Which of the following summarizes the financial position of a company at a particular date? a) Statement of Cash Flows b) Profit &Loss Statement c) Statement of Owner's Equity d) Balance Sheet 3. Which of the following is concerned with the reporting of accounting information exclusively to directors at executive level for decision-making purposes? a) Financial Accounting b) Tax Accounting c) Managerial Accounting d) Public Accounting 4. Which of the following institutions is well-known and plays a major role in setting accounting standards? a) SEC b) AICPA c) IASB d) IIA

1. Which of the following is an accounting principle?<br />a) Market Value<br />b) Entity<br />c) Subjectivity<br />d) Business Ethics<br /><br />Answer: b) Entity<br /><br />Explanation: The accounting principle that states that the business is separate from its owners is known as the Entity principle. This principle ensures that the financial activities of the business are recorded separately from the personal financial activities of its owners.<br /><br />2. Which of the following summarizes the financial position of a company at a particular date?<br />a) Statement of Cash Flows<br />b) Profit & Loss Statement<br />c) Statement of Owner's Equity<br />d) Balance Sheet<br /><br />Answer: d) Balance Sheet<br /><br />Explanation: The Balance Sheet is a financial statement that summarizes a company's assets, liabilities, and equity at a specific point in time. It provides a snapshot of the company's financial position and is used to assess the solvency and liquidity of the business.<br /><br />3. Which of the following is concerned with the reporting of accounting information exclusively to directors at executive level for decision-making purposes?<br />a) Financial Accounting<br />b) Tax Accounting<br />c) Managerial Accounting<br />d) Public Accounting<br /><br />Answer: c) Managerial Accounting<br /><br />Explanation: Managerial Accounting is concerned with providing accounting information to internal management for decision-making purposes. It focuses on providing relevant and timely information to managers at various levels of the organization to assist in planning, controlling, and directing the company's operations.<br /><br />4. Which of the following institutions is well-known and plays a major role in setting accounting standards?<br />a) SEC<br />b) AICPA<br />c) IASB<br />d) IIA<br /><br />Answer: c) IASB<br /><br />Explanation: The International Accounting Standards Board (IASB) is a well-known institution that plays a major role in setting accounting standards. It is responsible for developing and promoting the use of International Financial Reporting Standards (IFRS), which are designed to bring consistency to accounting practices across different countries and improve the transparency and comparability of financial statements.