Multiple Choice Question 62 Your answer is correct. One of the elements of financial statements is comprehensive income. As described in Statement of Financial Accounting Concepts No. 6, "Elements of Financial Statements," comprehensive income is equal to revenues minus expenses plus gains minus losses plus investments by owners minus distributions to owners. revenues minus expenses plus gains minus losses plus investments by owners minus distributions to owners plus assets minus liabilities. None of these. revenues minus expenses plus gains minus losses. Multiple Choice Question 115 Your answer is correct. Which of the following statements concerning the cost-benefit relationship is not true? If needed by financial statement users, management should gather information not included in the financial statements that would not otherwise be gathered for internal use. Management should not be required to report information that would significantly harm the company's competitive position. Management should not be required to provide forecasted financial information. Business reporting should exclude information outside of management's expertise. Multiple Choice Question 102 Your answer is correct. Not adjusting the amounts reported in the financial statements for inflation is an example of which basic principle of accounting? Economic entity. Going concern. Full disclosure. Historical cost. Multiple Choice Question 116 Your answer is correct. Which of the following relates to both relevance and faithful representation? predictive value neutrality cost constraint verifiability Multiple Choice Question 60 Your answer is correct. In classifying the elements of financial statements, the primary distinction between revenues and gains is the costs versus the benefits of the alternative methods of disclosing the transactions involved. the materiality of the amounts involved. the likelihood that the transactions involved will recur in the future. the nature of the activities that gave rise to the transactions involved. Multiple Choice Question 110 Your answer is correct. All of the following represent costs of providing financial information except disseminating. preparing. auditing. accessing capital. Multiple Choice Question 70 Your answer is correct. Which basic element of financial statements arises from peripheral or incidental transactions? Assets. Liabilities. Expenses. Gains. Multiple Choice Question 105 Your answer is correct. Which accounting assumption or principle is being violated if a company reports its corporate headquarter building at its fair value on the balance sheet? Monetary unit. Historical cost. Full disclosure. Going concern. Multiple Choice Question 21 Your answer is correct. Generally accepted accounting principles are fundamental truths or axioms that can be derived from laws of nature. derive their credibility and authority from general recognition and acceptance by the accounting profession. derive their authority from legal court proceedings. have been specified in detail in the FASB conceptual framework. Multiple Choice Question 34 Your answer is correct. What is meant by comparability when discussing financial accounting information? Information has predictive or confirmatory value. Information is reasonably free from error. Information that is measured and reported in a similar fashion across companies. Information is timely. Multiple Choice Question 63 Your answer is correct. Which of the following elements of financial statements is not a component of comprehensive income? revenues losses distributions to owners expenses Multiple Choice Question 84 Your answer is correct. Proponents of historical cost ordinarily maintain that in comparison with all other valuation alternatives for general purpose financial reporting, statements prepared using historical costs are more relevant. indicative of the entity's purchasing power. conservative. faithfully representative. Multiple Choice Question 30 Your answer is correct. What is a primary objective of financial reporting as indicated in the conceptual framework? provide information that is useful to those making investing and credit decisions provide information that is useful to management. provide information about those investing in the entity All of the above. Multiple Choice Question 69 Your answer is correct. Issuance of common stock for cash affects which basic element of financial statements? Losses. Liabilities. Equity. Revenues. Multiple Choice Question 92 Your answer is correct. The allowance for doubtful accounts, which appears as a deduction from accounts receivable on a balance sheet and which is based on an estimate of bad debts, is an application of the expense recognition principle. consistency characteristic. materiality constraint. revenue recognition principle.

Multiple Choice Question 62
 
 
     Your answer is correct.
One of the elements of financial statements is comprehensive income. As described in Statement of Financial Accounting Concepts No. 6, "Elements of Financial Statements," comprehensive income is equal to

 
revenues minus expenses plus gains minus losses plus investments by owners minus distributions to owners.
 
revenues minus expenses plus gains minus losses plus investments by owners minus distributions to owners plus assets minus liabilities.
 
None of these.
 
revenues minus expenses plus gains minus losses.

Multiple Choice Question 115
 
 
     Your answer is correct.
Which of the following statements concerning the cost-benefit relationship is not true?

 
If needed by financial statement users, management should gather information not included in the financial statements that would not otherwise be gathered for internal use.
 
Management should not be required to report information that would significantly harm the company's competitive position.
 
Management should not be required to provide forecasted financial information.
 
Business reporting should exclude information outside of management's expertise.

Multiple Choice Question 102
 
 
     Your answer is correct.
Not adjusting the amounts reported in the financial statements for inflation is an example of which basic principle of accounting?

 
Economic entity.
 
Going concern.
 
Full disclosure.
 
Historical cost.

Multiple Choice Question 116
 
 
     Your answer is correct.
Which of the following relates to both relevance and faithful representation?

 
predictive value
 
neutrality
 
cost constraint
 
verifiability

Multiple Choice Question 60
 
 
     Your answer is correct.
In classifying the elements of financial statements, the primary distinction between revenues and gains is

 
the costs versus the benefits of the alternative methods of disclosing the transactions involved.
 
the materiality of the amounts involved.
 
the likelihood that the transactions involved will recur in the future.
 
the nature of the activities that gave rise to the transactions involved.

Multiple Choice Question 110
 
 
     Your answer is correct.
All of the following represent costs of providing financial information except

 
disseminating.
 
preparing.
 
auditing.
 
accessing capital.


Multiple Choice Question 70
 
 
     Your answer is correct.
Which basic element of financial statements arises from peripheral or incidental transactions?

 
Assets.
 
Liabilities.
 
Expenses.
 
Gains.

Multiple Choice Question 105
 
 
     Your answer is correct.
Which accounting assumption or principle is being violated if a company reports its corporate headquarter building at its fair value on the balance sheet?

 
Monetary unit.
 
Historical cost.
 
Full disclosure.
 
Going concern.

Multiple Choice Question 21
 
 
     Your answer is correct.
Generally accepted accounting principles

 
are fundamental truths or axioms that can be derived from laws of nature.
 
derive their credibility and authority from general recognition and acceptance by the accounting profession.
 
derive their authority from legal court proceedings.
 
have been specified in detail in the FASB conceptual framework.

Multiple Choice Question 34
 
 
     Your answer is correct.
What is meant by comparability when discussing financial accounting information?

 
Information has predictive or confirmatory value.
 
Information is reasonably free from error.
 
Information that is measured and reported in a similar fashion across companies.
 
Information is timely.


Multiple Choice Question 63
 
 
     Your answer is correct.
Which of the following elements of financial statements is not a component of comprehensive income?

 
revenues
 
losses
 
distributions to owners
 
expenses


Multiple Choice Question 84
 
 
     Your answer is correct.
Proponents of historical cost ordinarily maintain that in comparison with all other valuation alternatives for general purpose financial reporting, statements prepared using historical costs are more

 
relevant.
 
indicative of the entity's purchasing power.
 
conservative.
 
faithfully representative.

Multiple Choice Question 30
 
 
     Your answer is correct.
What is a primary objective of financial reporting as indicated in the conceptual framework?

 
provide information that is useful to those making investing and credit decisions
 
provide information that is useful to management.
 
provide information about those investing in the entity
 
All of the above.

Multiple Choice Question 69
 
 
     Your answer is correct.
Issuance of common stock for cash affects which basic element of financial statements?

 
Losses.
 
Liabilities.
 
Equity.
 
Revenues.

Multiple Choice Question 92
 
 
     Your answer is correct.
The allowance for doubtful accounts, which appears as a deduction from accounts receivable on a balance sheet and which is based on an estimate of bad debts, is an application of the

 
expense recognition principle.
 
consistency characteristic.
 
materiality constraint.
 
revenue recognition principle.

                                        


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