monetary Unit 7. The principle of objectivity includes the concept of A. Summarization B. Verifiability C. Classification D. Conservatism
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- MULTIPLE CHOICE. Choose the best answer among the following choices. 6. The financial statements should be stated in terms of a common financial denominator. A. Accrual B. Going Concern C. Time Period D. Stable Monetary Unit 7. The principle of objectivity includes the concept of A. Summarization B. Verifiability C. Classification D. Conservatism 8. The financial accounting information is directed toward the common needs of users and is independent of presumptions about particular needs and desires of specific users. A. Completeness B. Verifiability C. Relevance D. Neutrality 9. The attribute of relevance include ALL EXCEPT: A. Predictive value B. Feedback value C. Materiality D. Neutrality 10. The assumption that an entity will continue to operate for the foreseeable future is called A. Accrual basis B. Comparability C. Going concern D. Cash basisMeaning of accounting principles with examples: i. Money measurement conceptii. Dual aspect concept iii. Objectivityiv. Historical costA recognition test assists with deciding whether items should be included in the financial statements. Which characteristic of a financial statement does this refer to? O A. Reliable O B. Complete OC. Material O D. Neutral Type here to search
- 2. Explain the following concept used in the preparation of financial statement i. Relevance ii. Reliability iii. Faithfull representation iv. Neutrality v. Completeness vi. Comparability1. Explain the objective of Financial Reporting 2. Explain cost constraint and materiality constraint by giving your own examples.Under Qualitative Characteristics of Useful Financial Information, which ofthe following is a qualitative characteristic associated with faithfulrepresentation:a. Completenessb. Free from errorc. Neutralityd. All the above
- Identify the root of the value maximization principle: O a. Accounting O b. Statistics O c. Economics O d. Finance3. Financial information that is capable of making a difference in a decision is a. faithfully representative. b. relevant. c. convergent. d. generally accepted.With regard to a qualitative characteristic of useful financial information, two fundamental qualitative characteristics. What are these two characteristics, and explain the meaning of these characteristics, and provide practical example for each of them? 1. Fundamental qualitative characteristics (first one) 2. practical example for the first one? 4 3. Fundamental qualitative characteristics (second one) 4. practical example for the second one?
- Credit Analysis is about ..... i.Liquidity and solvency ii.Profitability iii.Risk Select one: a. ii & iii b. i & iii c. i , ii & iii d. i & iiWith regard to a qualitative characteristic of useful financial information, twofundamental qualitative characteristics. What are these two characteristics, andexplain the meaning of these characteristics, and provide practical example foreach of them?1. Fundamental qualitative characteristics (first one)2. practical example for the first one? 43. Fundamental qualitative characteristics (second one)4. practical example for the second one?Listed below are several information characteristics and accounting principles and assumptions. Match the letter of each with the appropriate phrase that states its application. (Items a through k may be used more than once.) a. Economic entity assumption b. Going concern assumption c. Monetary unit assumption d. Periodicity assumption e. Historical cost principle f. Revenue recognition principle g. Matching principle h. Full disclosure principle i. Relevance characteristic j. Reliability characteristic. k. Consistency characteristic 1. Stable-dollar assumption (do not use historical cost principle). 2. Earning process completed and realized or realizable. 3. Presentation of error-free information with representational faithfulness. 4. Yearly financial reports. 5. Accruals and deferrals in adjusting and closing process. (Do not use going concern.) 6. Useful standard measuring unit for business transactions. 7. Notes as part of necessary information to a fair presentation. 8. Affairs of…