HOSP228 - Topic 2 - Managerial A/c

What is the basic accounting equation?

• Assets = Liabilities + Equity

• Revenue = Expenses + Profit

• Assets = Liabilities - Equity

• Income = Revenue - Expenses

What is the primary task of bookkeepers in the hospitality industry?

• Managing customer relations

• Recording financial transactions

• Preparing food

• Cleaning hotel rooms

Which level of the pyramid is primarily focused on compiling and summarizing financial data?

• Basic bookkeeping

• Summary accounting

• Financial analysis

• Cost management

What is the purpose of dividends?

• To return investment to stockholders

• To increase company liabilities

• To reduce company assets

• To pay off company debts

Which of the following is NOT a permanent owners' equity account?

• Retained earnings

• Stock

• Temporary earnings

• Owners’ investment

What is the basic accounting equation as modified in the document?

• Assets = Liabilities + Owners' Equity

• Assets = Liabilities + Permanent Owners' Equity + Temporary Owners' Equity

• Assets = Liabilities + Revenue - Expenses

• Assets = Liabilities + Stocks + Retained Earnings

What is the purpose of the accounting equation as described in the document?

• To calculate profit

• To balance financial statements

• To show the relationship between assets, liabilities, and owners' equity

• To determine tax liabilities

Is it possible to make changes to only one side of the accounting equation?

• No, it is not possible

• Yes, but only additions

• Yes, but only subtractions

• Yes, equal additions and subtractions can be made

Which of the following is a component of the accounting equation?

• Revenue

• Expenses

• Assets

• Profit

What does the term "Owners' Equity" refer to in the accounting equation?

• The company's debts

• The company's revenue

• The owner's claims on the company's assets

• The company's expenses