Northeastern University

ACCOUNTING 1201

Chapter 2

1)What is the primary objective of financial accounting?

2.What are the two qualitative characteristics of “useful” information? What do they mean?

2. What are the basic assumptions / the measurement concept that underlie many of the accounting concepts?
3. How do we determine when an asset or a liability is “current”?
4. What is a transaction? What is necessary for an event to be considered a transaction?
5. What are typical accounts listed on the Balance Sheet? What are the basic journal entries

recorded for investing and financing activities that affect the Balance Sheet?

6. How do we increase / decrease an asset, liability, or equity account (debits vs. credits).