Chapter 01 Accounting: The Language of Business True / False Questions 1. The purpose of accounting is to provide financial information about an economic or social entity. True False 2. An accounting system is designed to accumulate and classify data about a firm's financial affairs and summarize it in the general journal. True False 3. In a sole proprietorship, the owner is responsible for the debts of the business if the firm is unable to pay. True False 4. Laws passed by Congress in 1933 and 1934 gave the Securities and Exchange Commission (SEC) final say on matters of financial reporting by publicly owned corporations. True False 5. Currently, generally accepted accounting principles are developed by the American Institute of Certified Public Accountants (AICPA) True False 6. The Securities and Exchange Commission (SEC) requires that publicly owned corporations submit financial statements to it each year.