SOUTHERN UNIVERSITY and A&M; COLLEGE ACCT 300 INTERMEDIATE ACCOUNTING 1 FALL 201

Question

SOUTHERN UNIVERSITY and A&M; COLLEGE ACCT 300 INTERMEDIATE ACCOUNTING 1 FALL 2017 FINAL EXAM INSTRUCTIONS i). Answer all questions . Use a scantron form for section A and space provided for section B SECTION A MULTIPLE CHOICE QUESTIONS 1. What is the objective of inancial reporting? a. Provide information that is useful to management for managing a business b. Provide information that clearly portrays nonfinancial transactions c Provide information about the reporting entity that is useful to present and potential equity investors, lenders, and other creditors d. Provide information that excludes claims to the resources 2 When income statement reports sales of $10 million and yet actual sales were only $3 million, what qualitative characteristic of accounting information is violated? a Neutrality b. Consistency c. Confirmatory value d. Faithful representation 3. The two fundamental qualities that make accounting information useful for decision making are a comparability and timeliness b materiality and neutrality c. relevance and faithful representation d faithful representation and comparability 4. According to U.S. GAAP revenue recognition standard, revenue should be a Cash is received b The performance obligation is met c Production is completed d Shares are issued

Explanation / Answer

1)The Objective of financial reporting:
c)Provide information about the reporting entity that is useful to present and potential equity investors,lenders and other creditors.
2)If the income statement present sales 3 millions instead of 10 millions will treat as voilating the D)Faithful presentation(relibility)
3)Answer is C) The fundamental quality for making useful for deision making is relevance and faithful presentation

4)According to US GAAP revenue shall be recognised on b.when the performance obligations is met.

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