Exam A A-5 Problem A-ll-Key Conceptual Terms. Various accounting assumptions, pr

Question

Exam A A-5 Problem A-ll-Key Conceptual Terms. Various accounting assumptions, principles below. Select those which best justify the following the corresponding letter(s) in the space(s) provided. A letter may be used more han and characteristics are accounting procedures and indicate listed once or not at all. a. Historical cost f. Economic entity g. Cost constraint h. Conservatism L Periodicity . Expense recognition b. Relevance c. Monetary unit d. Going concern e. Consistency k. Revenue recognition I. Full disclosure m. Faithful representation 1. Chose the solution that will be least likly to overstate assets or income. 2. Describing the depreciation methods used in the financial statements 3. Applying the same accounting treatment to similar accounting events 4. The quality which helps users make predictions about present, past, and future events. 5. Recording a transaction when goods or services are exchanged for cash or claims to cash. 6. Preparing consolidated statements 7. Information must make a difference or a company need not disclose it. 8. Provides the figure at which to record a liability 9. The preparation of timely reports on continuing operations 10. Accrual accounting (do not use "going concern"). 11. Reporting those items which are significant enough to affect decisions. Select two 12. Additivity of financial statement figures relating to different time periods. 13. Ignoring the phenomenon of price-level changes ( 14. Not reporting assets at liquidation prices (do not use Thistorical cosr') 15. Characterized by completeness, neutrality, and being froo from error. 16. Establishment of an allowance for doubdul accounts 17. Use of estimating procedures for amortization policies. Select two (do not use (do not use "Thistorical cost") 13 periodicity') (17 and 18). 18. See item 17 above.

Explanation / Answer

ANSWER

1                              F

2                              L

3                              E

4                              M

5                              K

6                              I

7                              B

8                              C

9                              I

10                           K

11                           B

12                           E

13                           G

14                           G

15                           M

16                           H

17                           D

18                           E

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