for the term.
TERM PHRASE
Term number that matches the
phrase.
1. Losses Net outflows from peripheral transactions. ____
2. Assets Increases in equity from the sale of goods and/or services. ____
3. Revenues Results if an asset is sold for more than book value. ____
4. Comprehensive income All changes in equity except owner transactions. ____
5. Gains Probable future economic benefits controlled by an entity. ____
TERM PHRASE
Term number that matches the
phrase.
1. Losses Net outflows from peripheral transactions. 1
2. Assets Increases in equity from the sale of goods and/or services. 3
3. Revenues Results if an asset is sold for more than book value. 5
4. Comprehensive income All changes in equity except owner transactions. 4
5. Gains Probable future economic benefits controlled by an entity. 2
References
Essay Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
138.
Award: 10.00 points
Listed below are 10 organizations followed by a list of phrases that describe or characterize the organizations. Match each phrase with the correct
organization by placing the number designating the best term in the space provided by the phrase.
TERM PHRASE
Term number that matches the
phrase.
1. SEC Establishes auditing standards in the U.S. for public companies. ____
2. FASB Primary national organization of accountants working in industry. ____
3. IASB Sets accounting standards in the United States. ____
4. AICPA Provides timely responses to financial reporting issues. ____
5. EITF The FASB's parent organization. ____
6. PCAOB Advises the FASB. ____
7. IMA FASB's predecessor. ____
8. FASAC Regulates the financial reporting for public companies. ____
9. APB National organization of certified public accountants. ____
10. FAF Sets global accounting standards. ____
TERM PHRASE
Term number that matches the
phrase.
1. SEC Establishes auditing standards in the U.S. for public companies. 6
2. FASB Primary national organization of accountants working in industry. 7
3. IASB Sets accounting standards in the United States. 2
4. AICPA Provides timely responses to financial reporting issues. 5
5. EITF The FASB's parent organization. 10
6. PCAOB Advises the FASB. 8
7. IMA FASB's predecessor. 9
8. FASAC Regulates the financial reporting for public companies. 1
9. APB National organization of certified public accountants. 4
10. FAF Sets global accounting standards. 3
References
139.
Award: 10.00 points
Essay Learning Objective: 01-03 Define
generally accepted accounting
principles (GAAP) and discuss
the historical development of
accounting standards, including
convergence between U.S. and
international standards.
Difficulty: 2 Medium Learning Objective: 01-05
Explain factors that encourage
high-quality financial reporting.
Compare net income (loss) for the year to net cash flow from operating activities. Why are these amounts different? Briefly explain.
These amounts are different because of the differences between cash and accrual accounting. As opposed to cash flows from operations, net income
includes both revenues and expenses the timing of which differs from the timing of certain cash receipts and payments. Examples would be credit sales in
which the revenues are recorded before the collection of cash and cost of goods sold in which the expense often is recorded later than the cash payment
to the supplier for the merchandise.
References
Essay Difficulty: 2 Medium Learning Objective: 01-02 Explain the difference between cash
and accrual accounting.
140.
Award: 10.00 points
For each of the following situations, state whether you agree or disagree with the financial reporting practice employed, and briefly explain the reason for
your answer.
1. Cantor Corporation's accountant increased the book value of a patent from its original cost of $1 million to its recently appraised value of $6 million.
2. Stanton Corporation paid for the personal travel of its chief financial officer and charged travel expense.
3. At the end of its 2021 fiscal year, Dower, Incorporated, received an order from a customer for $60,000. The merchandise will ship early in 2022. Because
the sale was made to a long-time customer and the invoice was paid in 2021, the controller recorded the sale in 2021.
4. In the middle of its 2021 fiscal year, Sanguinetti, Incorporated paid $12,000 to its insurance company for one-year comprehensive insurance coverage.
Sanguinetti recorded the entire expenditure as an expense in 2021.