Tutorial 1 Topic 1 Question 1 Identify the activities and users associated with accounting. Question 2 State the accounting equation, and define its components. Question 3 Cite the appropriate accounting concept for the following descriptions. No. Description 1 Financial statements reflect the assumption that the business continues operating. 2 3 4 5 Information is based on actual costs incurred in transactions. A company records the expenses incurred to generate the revenues reported. Every business is accounted for separately from its owner or owners. The principle that assumes transactions and events can be expressed in money units Question 4 Classify the following items into Assets, Liabilities, Revenue, Expenses, Investment by Owner or Owner's Drawings. 1 Interest on loan 2 3 4 5 6 Freehold Land 7 Capital 8 Utilities Interest on fixed deposit Fixture and fittings Insurance paid Goodwill 9 Bank overdraft 10 Office Equipment 11 Commission paid 12 Advertising 13 Building 14 Interest payable 15 Investment 1 16 Sales 17 18 Inventory Purchase 19 Accounts Payable 20 21 22 23 Accounts Receivable Rent received Motor vehicle Discount received 24 Patents 25 Cash in hand 26 27 28 29 Salaries 30 Accounting concept Cost of goods sold Salaries payable Transportation cost Rental payable