Financial Reporting and Analysis: Using Financial Accounting Information 13th test bank

NAT:  BUSPROG: Communication           
STA:   AICPA: FN: Measurement | ACBSP: GAAP | IMA: Financial Statement Analysis
TOP:   Development of Generally Accepted Accounting Principles (GAAP) in the United States
KEY:  Bloom's: Knowledge                        NOT:  Time: 1 min.            
 
   18.   Accountants face a problem of when to recognize revenue. Which of the following methods of recognizing revenue is not used in practice?
a.
Point of sale

b.
Point of order acceptance

c.
End of production

d.
Receipt of cash

e.
Revenue recognized during production

 
 
ANS:  B                    PTS:   1                    DIF:    Difficulty: Easy        
NAT:  BUSPROG: Communication           
STA:   AICPA: FN: Reporting | ACBSP: GAAP | IMA: Financial Statement Analysis
TOP:   Traditional Assumptions of the Accounting Model             KEY:  Bloom's: Knowledge
NOT:  Time: 1 min.            
 
   19.   The organization that has by federal law the responsibility to adopt auditing standards is the:
a.
New York Stock Exchange.

b.
Public Company Accounting Oversight Board.

c.
Accounting Principles Board.

d.
Financial Accounting Standards Board.

e.
AICPA Committee on Accounting Procedure.

 
 
ANS:  B                    PTS:   1                    DIF:    Difficulty: Easy        
NAT:  BUSPROG: Communication           
STA:   AICPA: FN: Measurement | ACBSP: GAAP | IMA: Financial Statement Analysis
TOP:   Development of Generally Accepted Accounting Principles (GAAP) in the United States
KEY:  Bloom's: Knowledge                        NOT:  Time: 1 min.            
 
   20.   By law, the setting of accounting standards is the responsibility of the:
a.
AICPA Committee on Accounting Procedure.

b.
New York Stock Exchange.

c.
Accounting Principles Board.

d.
Securities and Exchange Commission.

e.
Financial Accounting Standards Board.

 
 
ANS:  D                   PTS:   1                    DIF:    Difficulty: Easy        
NAT:  BUSPROG: Communication           
STA:   AICPA: FN: Measurement | ACBSP: GAAP | IMA: Financial Statement Analysis
TOP:   Development of Generally Accepted Accounting Principles (GAAP) in the United States
KEY:  Bloom's: Knowledge                        NOT:  Time: 1 min.            
 
   21.   The assumption that allows accountants to accept some inaccuracy, because of incomplete information about the future, in exchange for more timely reporting is:
a.
conservatism.

b.
time period.

c.
business entity.

d.
materiality.

e.
realization.

 
 
ANS:  B                    PTS:   1                    DIF:    Difficulty: Easy