TEST BANK
Intermediate Accounting, 18th Edition
by Kieso, Warfield Chapter 1 - 23 Complete
,Table of Contents
k k
1kThekEnvironmentkandkConceptualkFrameworkkofkFinancialkReporting
2kThekAccountingkInformationkSystem
3kIncomekStatement,kRelatedkInformation,kandkRevenuekRecognition
4kBalancekSheetkandkStatementkofkCashkFlows
5kAccountingkandkthekTimekValuekofkMoney
6kCashkandkReceivables
7kValuationkofkInventories:kAkCost-BasiskApproach
8kInventories:kAdditionalkValuationkIssues
9kAcquisitionkandkDispositionkofkProperty,kPlant,kandkEquipment
10kDepreciation,kImpairments,kandkDepletion
11kIntangiblekAssets
12kCurrentkLiabilitieskandkContingencies
13kLong-TermkLiabilities
14kStockholders’kEquity
15kDilutivekSecuritieskandkEarningskperkShare
16kInvestments
17kRevenuekRecognition
18kAccountingkforkIncomekTaxes
19kAccountingkforkPensionskandkPostretirementkBenefits
20kAccountingkforkLeases
21kAccountingkChangeskandkErrorkAnalysis
22kStatementkofkCashkFlows
23kFullkDisclosurekinkFinancialkReportingk
, CHAPTER 1 k
THE ENVIRONMENT AND CONCEPTUAL FRAMEWORK
k k k k k
OF FINANCIAL REPORTING k k
IFRSkquestionskarekavailablekatkthekendkofkthiskchapter.
TRUE-FALSE—Conceptual
1. Financialkstatementskarekthekprincipalkmeanskthroughkwhichkakcompanykcommunicateskitskfi
nancialkinformationktokthosekoutsidekit.
Ans:k T,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
2. Usersk ofk financialk reportsk ofk ak companyk usek thek informationk providedk byk thesek reportsk to
kmakekcapitalkallocationkdecisions.
Ans:k T,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
3. Ankeffectivekprocesskofkcapitalkallocationkprovideskankefficientkmarketkforkbuyingkandksellingks
ecuritieskandkobtainingkandkgrantingkcredit.
Ans:k T,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
4. Investorskarekinterestedkinkfinancialkreportingkbecausekitkprovideskinformationkthatkiskusefulkfo
rkmakingkdecisions.
Ans:k T,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
5. Usersk ofk financialk accountingk statementsk havek bothk coincidingk andk conflictingk needsk fork
informationkofkvariousktypes.
Ans:k T,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
6. AlthoughkthekFASBkhaskdevelopedkakconceptualkframework,knokStatementskofkFinancialkAcc
ountingkConceptskhavekbeenkissuedktokdate.
Ans:kF,kLO:k1,kBloom:kK,kDifficulty:kModerate,kMin:k1,kAACSB:kKnowledge,kAICPAkBC:kNone,kAICPAkAC:kReporting,kAICPAkPC:kNone,kIMA:kRepor
tingk&k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
7. ThekpassagekofkaknewkFASBkAccountingkStandardskUpdatekrequiresktheksupportkofkfivekofk th
eksevenkboardkmembers.
Ans:k F,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
8. StatementskofkFinancialkAccountingkConceptsksetkforthkfundamentalkobjectiveskandk concept
skthatkarekusedkbykthekFASBkinkdevelopingkfuturekstandardskofkfinancialkaccountingkandkrepo
rting.
Ans:k T,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
9. ThekFASB’skCodificationkcreateskaknewksetkofkGAAP.
Ans:k F,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Repo
rtingk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
, 1k-k2 TestkBankkforkIntermediatekAccounting,kEighteenthkEdition
10. Thekobjectivekofkfinancialkreportingkisktokreportkthekplanskmadekbykakcompanyktokimprovekthek
productivitykofkitskemployees.
Ans:k F,k LO:k 1,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkPreparation,kIFRS:kNone
11. Ak soundlyk developedk conceptualk frameworkk enablesk thek FASBk tok issuek morek usefulk andk
consistentkpronouncementskoverktime.
Ans:k T,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
12. Akconceptualkframeworkkiskakcoherentksystemkofkconceptskthatkflowkfromkankobjective.
Ans:k T,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
13. Thek firstk levelk ofk thek conceptualk frameworkk identifiesk thek recognition,k measurement,k andk
disclosurekconceptskusedkinkestablishingkaccountingkstandards.
Ans:k F,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
14. Thekobjectivekofkfinancialkreportingkserveskaskthekfoundationkofkthekconceptualkframework.
Ans:k T,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
15. Userskofkfinancialkstatementskarekassumedktokneedknokknowledgekofkbusinesskandkfinancialk
accountingkmattersktokunderstandkthekinformationkcontainedkinkfinancialkstatements.
Ans:k F,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
16. Relevancek andk faithfulk representationk arek thek twok fundamentalk qualitiesk thatk makeka
ccountingkinformationkusefulkforkdecision-making.
Ans:k T,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
17. Thekideakofkconsistencykdoesknotkmeankthatkcompanieskcannotkswitchkfromkonekaccountingk
methodktokanother.
Ans:kT,kLO:k2,kBloom:kC,kDifficulty:kModerate,kMin:k1,kAACSB:kKnowledge,kAICPAkBC:kNone,kAICPAkAC:kReporting,kAICPAkPC:kNone,kIMA:kReportin
gk&k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
18. Timelinesskandkneutralitykarektwokingredientskofkrelevance.
Ans:k F,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
19. Verifiabilitykandkpredictivekvaluekarektwokingredientskofkfaithfulkrepresentation.
Ans:k F,k LO:k 2,k Bloom:k K,k Difficulty:k Easy,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Reporting,k AICPAk PC:k None,k IMA:k Reporti
ngk &k Control:kFinancialkStatementkAnalysis,kIFRS:kNone
20. Revenues,kgains,kandkdistributionsktokownerskallkincreasekequity.
Ans:k F,k LO:k 2,k Bloom:k C,k Difficulty:k Moderate,k Min:k 1,k AACSB:k Knowledge,k AICPAk BC:k None,k AICPAk AC:k Measurementk Analysisk andk Interpreta
tion,k AICPAkPC:kNone,kIMA:kReportingk&kControl:kFinancialkStatementkAnalysis,kIFRS:kNone
21. Comprehensivek incomek includesk allk changesk ink equityk duringk ak periodk exceptk those
kresultingkfromkinvestmentskbykownerskandkdistributionsktokowners.
Ans:kT,kLO:k2,kBloom:kK,kDifficulty:kEasy,kMin:k1,kAACSB:kKnowledge,kAICPAkBC:kNone,kAICPAkAC:kMeasurementkAnalysiskandkInterpretation,kAI
CPAk PC:kNone,kIMA:kReportingk&kControl:kFinancialkStatementkAnalysis,kIFRS:kNone
