Intro to accounting
What is the formula for Accounting Equation?
Assets= Liabilities + Capital
What is the accounting cycle?
This is the steps taken to complete the accounting within a business which are repeated each accounting period.
Name 2 professional organizations as an umbrella of the accounting profession or auditor
CECCAR (The Body of Expert and Licensed Accountants from Romania)
CAFR (Chamber of Financial Auditors of Romania)
What is the purpose of Accounting?
To produce financial statements to see clearly whether the business is making a profit or loss in order to make informed decisions
The accounting cycle begins by recording information from ..............
Source Documents
Which are the main accounting regulations in Romania?
Accounting Law 82/1991.
MoPF Order no. 1802/2014 approves the accounting regulations on the annual individual and consolidated financial statements.
There are two categories of users of Accounting. What are they? What kind of information do they need?
Internal and External
Internal- Managerial Accounting, Financial Accounting
External - Financial Accounting
The list of all account titles and their balances that is prepared at the end of a certain period is done at which stage?
Trial Balance
Which are the financial statements that have to be prepared by the medium and large entities annually?
Medium and large entities- prepare annual financial statements:
1. Balance Sheet;
2. Income Statement;
3. Statement of Changes in Equity;
4. Cash Flow Statement;
5. Explanatory Notes.
They will be accompanied by the form "Informative data" and
"Statement of Intangible Assets".
Why would Managers and Employees need accounting information?
Management- to make informed decisions regarding the business.
Employees- to know the profitability of the company which affects their salary
What types of reports are created during the accounting cycle for the use of management?
Financial Statements
Which of the assets apply amortization/ depreciation in Romania? Why?
Tangible and intangible assets excepting land
The expense is recognized throughout an asset's useful life. The calculation of depreciation expense follows the matching principle, which requires that revenues earned in an accounting period be matched with related expenses.