1) Accounting is an information system that measures business activities.
2) Bookkeeping is the mechanical part of accounting.
3) Accounting is often called the language of business.
4) Accounting produces financial statements, which report information about a business entity.
5) The accounting process begins and ends with people making decisions.
6) Accounting information is used by investors and lenders, but not by regulatory bodies.
7) Habitat for Humanity does not use accounting information since they are not concerned about making a profit.
8) The business records of a sole proprietorship should include the proprietor's personal assets such as a house.
9) Accounting:
A) measures business activities.
B) processes data into reports and communicates the data to decision makers.
C) is often called the language of business.
D) is all of the above.
10) A disadvantage of general partnerships is:
A) double taxation of distributed profits.
B) the partnership's assets are commingled with each partner's personal assets.
C) state rules and regulations must be followed.
D) each partner may conduct business in the name of the entity and make agreements that legally bind all partners.