References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
80.
Award: 10.00 points
Gains are:
Inflows from selling a product or service to a customer.
Increases in equity resulting from transfers of assets to the company from owners.
Increases in equity from peripheral transactions of an entity.
None of these answer choices are correct.
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
81.
Award: 10.00 points
When there is agreement between a measure or description and the phenomenon it purports to represent, information possesses which characteristic?
Faithful representation
Verifiability
Timeliness
Predictive value
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
82.
Award: 10.00 points
Surefeet Corporation changed its inventory valuation method. Which characteristic is jeopardized by this change?
Representational faithfulness
Feedback value
Consistency
Comparability
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
83.
Award: 10.00 points
Elements of financial statements do not include:
Losses.
Comprehensive income.
Monetary unit.
Investments by owners.
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
84.
Award: 10.00 points
Which of the following is true regarding equity?
It represents the owner’s return for investing in the business.
It represents the residual interest in the assets of an entity that remains after deducting its liabilities.
It represents how much the owner profits from the business.
It represents the accumulated earnings of the business over time.
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
85.
Award: 10.00 points
Cash dividends are an example of which of the following elements?
Investment by owners
Expenses
Distribution to owners
Equity
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
86.
Award: 10.00 points
The primary objective of financial accounting information is to provide useful information about economic activity to:
Regulators.
Academicians.
Management.
Capital providers.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-06 Explain the purpose of the conceptual
framework.
87.
Award: 10.00 points
Of the following, the most important objective for financial reporting is to provide information useful for:
Making decisions.
Providing accountability.
Determining taxable income.
Increasing future profits.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.
88.
Award: 10.00 points
Management has decided to change the estimated useful life of a machinery but fails to disclose this change in the financial statements. This violation of
GAAP can cause the information to be misleading because it lacks:
Timeliness.
Completeness.
Confirmatory value.
Neutrality.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-07 Identify the objective and qualitative
characteristics of financial reporting information and the elements
of financial statements.