Accoutning Test Bank

The Financial Accounting Standards Board employs a ascribable process system which (Points 5) has all CPAs in the United States vote on a new Statement. enables interested percentageies to express their views on issues under consideration. identifies the account statement issues that be the most important. requires that all accountants receive a copy of fiscal standards. 2. (TCO A) The IASB (Points 5) governs accounting standards in the U. S. is working on a convergence discombobulate with the FASB. sets the accounting standards for only European countries. lays only a minor part in accounting rule making throughout the world. 3. (TCO A) International GAAP, or i-GAAP (Points 5) has different standards than under U. S. GAAP. has some commonality with U. S. GAAP in many an(prenominal) areas. is accepted by many countries throughout the world all of the supra are true. 4. (TCO A) Information is neutral if it (Points 5) provides benefits which are at least follow to the costs of i ts preparation. can be compared with similar information roughly an try at other points in time. would have no impact on a decision maker. is free from bias toward a predetermined result. . (TCO A) Which of the spare-time activity elements of financial statements is non a component of comprehensive income? (Points 5) Revenues Distributions to owners losings Expenses 6. (TCO A) matter of common stock for cash affects which basic element of financial statements? (Points 5) Revenues Losses Liabilities Equity 7. (TCO A) Which basic element of financial statements arise from peripheral or incidental transactions? (Points 5) Assets Liabilities Gains Expenses 8. (TCO A) Which basic effrontery may not be followed when a firm in bankruptcy reports financial results? Points 5) Economic entity assumption Going concern assumption cyclicity assumption Mo give the axeary whole assumption 9. (TCO A) What is the quality of information that enables users to better forecast future trading ope rations? (Points 5) Reliability. Materiality. Comparability. Relevance. 10. (TCO A) Financial information exhibits the characteristic of consistency when (Points 5) expenses are reported as charges against revenue in the stop consonant in which they are paid. accounting entities spend accountable events the same accounting treatment from period to period. xtraordinary gains and losses are not included on the income statement. accounting procedures are adopted which devote a consistent rate of net income 11. (TCO A) Which of the following is true with sham to the element comprehensive income? (Points 5) includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. is optional for financial statement preparers. is not in accordance with GAAP. came into law with the passing of the Sarbanes-Oxley Act. Not 100% sure about 11 12. TCO A) Which of the following basic accounting assumptions is threatened by the worldly conc ern of severe inflation in the economy? (Points 5) Monetary unit assumption. Periodicity assumption. Going-concern assumption. Economic entity assumption. 13. (TCO D) One criticism not normally aimed at a quietus tacking prepared using certain accounting and inform standards is (Points 5) failure to reflect current value information. the extensive use of crumble salmagundis. an extensive use of estimates. failure to include items of financial value that cannot be recorded objectively. 4. (TCO D) The step of time that is expected to elapse until an asset is agnize or otherwise converted into cash is referred to as (Points 5) solvency. financial flexibility. liquidity. exchangeability. 15. (TCO D) The net assets of a business are equal to (Points 5) current assets minus current liabilities. total assets plus total liabilities. total assets minus total stockholders equity. none of these. 16. (TCO D) Houghton Company has the following items common stock, $720,000 treasury stock, $85,000 deferred taxes, $100,000 and retained earnings, $313,000.What total amount should Houghton Company report as stockholders equity? (Points 5) $848,000 $948,000 $1,048,000 $1,118,000 17. (TCO D) The current assets section of the balance sheet should include (Points 5) machinery patents goodwill inventory 18. (TCO D) An example of an item which is not an element of working capital is (Points 5) accrued interest on notes receivable. goodwill. goods in process. temporary investments. 19. (TCO D) Which of the following is not an acceptable major asset classification? (Points 5) Current assets Long-term assets Property, set up, and equipment Deferred charges 0. (TCO D) The presentation of long-term liabilities in the balance sheet should disclose (Points 5) maturity dates interest rates conversion rights all of the in a higher place 21. (TCO D) Equity or debt securities held to finance future construction of additional manufacturing plants should be classified on the balance she et as (Points 5) current assets. property, plant and equipment. intangible assets. long-term investments. 22. (TCO D) Treasury stock should be reported as a(n) (Points 5) current asset. investment other asset. reduction of stockholders equity.