Question 07:

(a) What is the Accounting Equation?

(b) What is meant by the "Double Entry" system of Accounting? What are its main advantages?

(c) In Australia the AASB from time to time issues Accounting Standards.

(i) What are these Accounting Standards?

(ii) What is their purpose?

(d) What is the purpose of an accounting system?

(e) List at least 5 key provisions of relevant legislation, regulations, standards and codes of practice that accountants must be aware of in preparing Financial Reports.

(f) Distinguish between the place of a Journal and a Ledger account in the Accounting Cycle.

(g) Identify the Accounting standard relevant to Inventories.