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EXAM #1- INTERMEDIATE ACCOUNTING TEST QUESTIONS WITH COMPLETE ANSWERS
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EXAM #1- INTERMEDIATE ACCOUNTING TEST QUESTIONS WITH COMPLETE ANSWERS
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EXAM #1- INTERMEDIATE ACCOUNTINGTEST QUESTIONS WITH COMPLETE
ANSWERS
Which of the following is an advantage of cash basis accounting vs. accrual basis
accounting? - Answer-It provides a more accurate representation of cash generated in a
specific period.
According to the FASB Conceptual Framework, financial information is considered
faithfully represented if it is - Answer-Complete, neutral, and free from error.
Select the statement below which correctly describes a characteristic of the conceptual
framework. - Answer-Guidance for communicating the accounting for transactions is
provided in the conceptual framework.
U.S. GAAP requires which of the following to be reported at fair value in a company's
financial statements?
I. Bonds payable
II. Stock options held as an investment - Answer-II only.
Comparability, understandability, timeliness, and verifiability are enhancing qualitative
characteristics that contribute to:
Relevance Faithful Representation
a. Yes No
b. No No
c. No Yes
d. Yes Yes - Answer-Option d
Information is considered material to the financial statements if:
I. It falls within industry-specific quantitative guidelines published by the Financial
Accounting Standards Board.
II. Its omission could make a difference in the decisions made by a user relying on the
financial statements.
III. Its misstatement could make a difference in the decisions made by a user relying on
the financial statement. - Answer-II and III only.
Consistency and feedback relate most closely to which two of the following accounting
concepts, respectively? - Answer-Predictive value and confirmatory value
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