Q5: What are the objectives of Financial Accounting?
1: To record business transactions systematically
2: To find profit or loss
3: To show financial position
4: To provide information to stakeholders
5: To meet legal and tax requirements
1: Decrease in value of fixed assets
2: Caused by wear and tear and obsolescence
3: Charged every year on assets
4: Reduces profit but is a non-cash expense
5: Methods: SLM and WDV
1: Statement of assets, liabilities and capital
2: Shows financial position on a specific date
3: Follows Assets = Liabilities + Capital
4: Divided into current and non-current
5: Helps to check solvency of business
Q2: What is the difference between Debit and Credit
1: Debit is on left side, Credit is on right side
2: Debit increases assets and expenses
3: Credit increases liabilities, capital and income
4: Based on double entry system
5: Total debit must equal total credit
1: Recording and classifying financial transactions
2: Preparing financial statements like P&L and Balance Sheet
3: Shows profit, loss and financial position
4: Follows GAAP and accounting principles
5: Used by management, investors and government
1: Value of next best alternative foregone
2: Arises due to scarcity of resources
3: Used in decision making
4: Not recorded in accounting books
5: Helps in resource allocation
1: Shows inverse relationship between price and quantity demanded
2: When price rises, demand falls
3: When price falls, demand rises
4: Assumes income and tastes remain constant
5: Shown by a downward sloping demand curve
1: Application of economic theory to business decision making
2: Helps in profit maximization and cost minimization
3: Used for demand forecasting and pricing decisions
4: Connects economics with management
5: Helps managers take rational decisions
