1. In a private company’s accounting system, inputs are __________ and outputs are __________. a. transactions such as sales, payroll, and other expenses; financial statements 2. What describes an activity associated with accounting? a. summarizing and interpreting company financial information 3. The primary purpose of accounting is to a. help managers make well-informed decisions. 4. Buying and selling goods, acquiring insurance, and using supplies represent __________ transactions. a. financial 5. A summary of all the financial data in the account ledgers that ensures the figures are correct and balanced is called a. a trial balance. 6. What statement is accurate regarding double-entry bookkeeping? a. With double-entry bookkeeping, if the transaction amounts are not equal, the bookkeeper knows there is a mistake. 7. What is an important difference between bookkeepers and accountants? a. Accountants analyze financial statements. 8. A specialized accounting book in which information is accumulated into specific categories and posted so managers can find all information about one account in the same place is a a. Ledger 9. The recording of business transactions is a basic part of financial reporting and is referred to as a. bookkeeping. 10. Accumulated earnings from a firm’s profitable operations that are kept in the business and not paid out to stockholders are called a. retained earnings.