Multiple Choice Questions 1. Which of the following main issues are included in the definition of accounting? a) recognizing, recording, classifying, and summarizing business transactions b) measuring, analyzing, processing, and interpreting operating results c) reporting and presenting the financial position d) all of the above 2. The American Accounting Association defines accounting to be: a) the process of measuring, analyzing, processing, interpreting result of operation, reporting and presenting financial Position b) the process of identifying, measuring and communicating economic information to permit informed judgements and decisions by users of that information c) the process of recognizing, recording, classifying and summarizing business transaction d) all of the above 3. Internal decision makers include: a) the management of the company b) the investors and customers c) the creditors d) all of the above 4. Islamic concepts underscore the significance of accountability in Islam with particular reference to financial transactions including: a) Islamic law of inheritance (mawarith) and the calculation of obligatory alms (zakat) b) khilafah (vicegerency) and taklif (responsibility) c) the underlying concept of tawhid (unity of God) d) all of the above 5. The standard-setting body of the International Financial Reporting Standards (IFRS) Foundation is the: a) International Accounting Standards Board (IASB) b) International Accounting Standards (IAS) c) Standing Interpretations Committee (SIC) d) Accounting & Auditing Organization for Islamic Financial Institutions (AAOIFI) 6. The following statements about IFRS are correct except: a) The IFRS are a set of accounting standards developed by an independent, non-for-profit organisation called the International Accounting Standards Board (IASB) b) The main goal of the IFRS is to provide globally acceptable standards for private companies to enhance their reporting systems c) The IFRS contains general guidelines for financial reporting d) The IFRS has replaced the International Accounting Standards (IAS)