Test Bank Chapter 2 Conceptual Framework Underlying Financial Accounting.
Answers
Test Bank Chapter 2 Conceptual Framework Underlying Financial Accounting.
213 views 0 purchase
Course
Test Bank Chapter 2 Conceptual Framework Underlying Financial Accounting.
Institution
University
CONCEPTUAL FRAMEWORK UNDERLYING FINANCIAL ACCOUNTING
IFRS questions are available at the end of this chapter.
TRUE-FALSE—Conceptual
Answer No. Description
F 1. Nature of conceptual framework.
T 2. Conceptual framework definition.
F 3. Levels of conceptual framework.
T 4 International concep...
test bank chapter 2 conceptual framework underlying financial accounting
Written for
University
Test Bank Chapter 2 Conceptual Framework Underlying Financial Accounting.
All documents for this subject (1)
Seller
Follow
solutions
Reviews received
Content preview
CHAPTER 2
CONCEPTUAL FRAMEWORK UNDERLYING
FINANCIAL ACCOUNTING
IFRS questions are available at the end of this chapter.
TRUE-FALSE—Conceptual
Answer No. Description
F 1. Nature of conceptual framework.
T 2. Conceptual framework definition.
F 3. Levels of conceptual framework.
T 4 International conceptual framework.
F 5. Statements of Financial Accounting Concepts.
T 6. Objective of financial reporting.
F 7. Financial statement users.
T 8. Relevance and faithful representation.
T 9. Consistency.
F 10. Relevance.
F 11. Faithful representation.
F 12. Basic elements.
T 13. Comprehensive income.
T 14. Going concern assumption.
F 15. Economic entity assumption.
F 16. Expense recognition principle.
T 17. Realizable revenues.
T 18. Supplementary information.
F 19. Cost benefit trade-off.
F 20. Conservatism.
MULTIPLE CHOICE—Conceptual
Answer No. Description
c 21. GAAP defined.
d 22. Purpose of conceptual framework.
c 23. Conceptual framework.
d 24. Conceptual framework purpose.
S
d 25. Conceptual framework benefits.
d 26. Objectives of financial reporting.
a 27. Decision usefulness.
d 28. Objective of financial reporting.
P
a 29. Financial reporting objectives.
a 30. Primary objective of financial reporting.
a 31. Primary objective of financial reporting.
b 32. Characteristic of accounting information.
c 33. Characteristic of accounting information.
c 34. Meaning of comparability.
a 35. Meaning of consistency.
,2-2 Test Bank for Intermediate Accounting, Fourteenth Edition
MULTIPLE CHOICE—Conceptual (cont.)
Answer No. Description
d 36. Ingredient of relevance.
c 37. Ingredient of reliability.
a 38. Consistency characteristic.
b 39. Primary quality of accounting information.
d 40. Quality of relevance.
a 41. Quality of reliability.
c 42. Consistency quality.
a 43. Decision-usefulness criterion.
c 44. Primary qualities of accounting information.
b 45. Definition of relevance.
b 46. Definition of reliability.
d 47. Relevance quality.
c 48. Materiality characteristic.
d 49. Completeness characteristic.
b 50. Neutrality characteristic.
d 51. Neutrality characteristic.
c 52. Definition of verifiability.
a 53. Quality of predictive value.
c 54. Quality of free from error.
d 55. Consistency.
b 56. Consistency characteristic.
b 57. Comparability and consistency.
d 58. Comparability.
d 59. Elements of financial statements.
c 60. Distinction between revenues and gains.
c 61. Definition of a loss.
d 62. Definition of comprehensive income.
b 63. Components of comprehensive income.
P
d 64. Comprehensive income.
S
b 65. Earnings vs. comprehensive income.
S
a 66. Reporting financial statement elements.
b 67 Basic element of financial statements.
a 68. Basic element of financial statements.
d 69. Basic element of financial statements.
c 70. Definition of gains.
d 71. Historical cost assumption.
c 72. Periodicity assumption.
b 73 Going concern assumption.
b 74. Periodicity assumption.
S
a 75. Monetary unit assumption.
S
c 76. Periodicity assumption.
c 77. Monetary unit assumption.
d 78. Economic entity assumption.
a 79. Economic entity assumption.
b 80. Periodicity assumption.
a 81. Going concern assumption.
d 82. Going concern assumption.
d 83. Implications of going concern assumption.
a 84. Historical cost principle.
MULTIPLE CHOICE—Conceptual (cont.)
Answer No. Description
d 85. Historical cost principle.
c 86. Revenue recognition principle.
d 87. Revenue recognition principle.
d 88. Revenue recognition principle.
d 89. Timing of revenue recognition.
c 90. Realization concept.
b 91. Definition of realized.
b 92. Expense recognition principle.
b 93. Expense recognition principle.
b 94. Expense recognition.
c 95. Full-disclosure principle.
a 96. Argument against historical cost.
d 97. Recognition of revenue.
b 98. Revenue recognition principle.
c 99. Deviation from revenue recognition principle.
a 100. Required components of financial statements.
d 101. Recognition of expenses.
c 102. Historical cost principle.
a 103. Expense recognition principle example.
d 104. Recording expenditure as asset.
c 105. Historical cost principle violation.
a 106. Full disclosure principle violation.
d 107. Full disclosure principle.
c 108. Historical cost principle violation.
a 109. Industry practice constraint.
c 110. Costs of providing financial information.
d 111. Benefits of providing financial information.
c 112. Use of materiality.
b 113. Definition of prudence/conservation.
a 114. Example of materiality constraint.
d 115. Constraints to limit the cost of reporting.
a 116. Cost-benefit constraint.
c 117. Materiality characteristic.
d 118. Materiality.
d 119. Pervasive constraints.
a 120. Prudence or conservatism.
b 121. Industry practices constraint.
a 122. Trade-offs between characteristics of accounting information.
c 123. Trade-offs between characteristics of accounting information.
P
c 124. Prudence or conservatism.
, 2-4 Test Bank for Intermediate Accounting, Fourteenth Edition
MULTIPLE CHOICE—CPA Adapted
Answer No. Description
a 125. Quality of predictive value.
b 126. Relevance and faithful representation.
b 127. Classification of gains and losses.
b 128. Earnings concept.
a 129. Components of comprehensive income.
b 130. Components of comprehensive income.
d 131. Components of comprehensive income.
d 132. Components of comprehensive income.
a 133. Definition of recognition.
P
Note: these questions also appear in the Problem-Solving Survival Guide.
S
Note: these questions also appear in the Study Guide.
1. Describe the usefulness of a conceptual framework.
2. Describe the FASB’s efforts to construct a conceptual framework.
3. Understand the objective of financial reporting.
4. Identify the qualitative characteristics of accounting information.
5. Define the basic elements of financial statements.
6. Describe the basic assumptions of accounting.
7. Explain the application of the basic principles of accounting.
8. Describe the impact that constraints have on reporting accounting information.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller solutions. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $14.49. You're not tied to anything after your purchase.
