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1 markAccounting Concepts and the Accounting Cycle

CSEC Principles of Accounts · May/June 2010 · Paper 2 · Question 7(c)(iv)

A series of accounting scenarios violates specific concepts or principles.

State the accounting concept or principle violated when the owner pays insurance for his private house and records it as a business expense.

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Other parts of this question

  1. 7(a)(i)Identify ONE internal user of accounting information and state how this information is used by that user.[2 marks]
  2. 7(a)(ii)Identify ONE external user of accounting information and state how this information is used by that user.[2 marks]
  3. 7(b)(i)Identify the type of business organisation described: Several employees are employed in a large organisation owned by a single person.[1 mark]
  4. 7(b)(ii)Identify the type of business organisation described: Three brothers operating a business where the action of one brother is binding on the other two brothers.[1 mark]
  5. 7(b)(iii)Identify the type of business organisation described: Shareholders cannot sell their shares in the company on the stock market.[1 mark]
  6. 7(b)(iv)Identify the type of business organisation described: Groups of consumers or producers form an organisation to provide services to its members.[1 mark]
  7. 7(b)(v)Identify the type of business organisation described: An organisation, operated by members, to provide services to members and is often financed by donations,…[1 mark]
  8. 7(c)(i)State the accounting concept or principle violated when credit sales made in March of 2010 were not recorded until the money was received in May 2010.[1 mark]
  9. 7(c)(ii)State the accounting concept or principle violated when management refuses to write off an uncollectible debt of…[1 mark]
  10. 7(c)(iii)State the accounting concept or principle violated when management changes from straight line depreciation to reducing balance method in order to report higher…[1 mark]
  11. 7(d)Draw a labelled diagram of the six (6) stages of the accounting cycle.[7 marks]

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