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:   Traditional Assumptions of the Accounting Model             KEY:  Bloom's: Knowledge
NOT:  Time: 1 min.            
 
   22.   Which of the following does not relate to The Public Company Accounting Oversight Board (PCAOB)?
a.
Two members of the board must be CPAs.

b.
In addition to appointing the five members of the PCAOB, the SEC is responsible for the oversight and enforcement authority over the Board.

c.
The PCAOB consists of five members appointed by the SEC.

d.
The PCAOB is to adopt auditing standards.

e.
The PCAOB is to adopt accounting standards.

 
 
ANS:  E                    PTS:   1                    DIF:    Difficulty: Moderate 
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: 3 min.            
 
   23.   Understating expenses is justified based on:
a.
time period assumption.

b.
conservatism assumption.

c.
materiality assumption.

d.
matching assumption.

e.
None of the answers are correct.

 
 
ANS:  E                    PTS:   1                    DIF:    Difficulty: Easy        
NAT:  BUSPROG: Communication           
STA:   AICPA: FN: Measurement | ACBSP: GAAP | IMA: Financial Statement Analysis
TOP:   Traditional Assumptions of the Accounting Model             KEY:  Bloom's: Knowledge
NOT:  Time: 1 min.            
 
   24.   At the end of the fiscal year, an adjusting entry is made that increases salaries payable and increases salaries expense. This entry is an application of which accounting principle?
a.
Full disclosure

b.
Materiality

c.
Matching

d.
Realization

e.
Historical cost

 
 
ANS:  C                    PTS:   1                    DIF:    Difficulty: Easy        
NAT:  BUSPROG: Communication           
STA:   AICPA: FN: Measurement | ACBSP: GAAP | IMA: Financial Statement Analysis
TOP:   Traditional Assumptions of the Accounting Model             KEY:  Bloom's: Comprehension
NOT:  Time: 1 min.            
 
   25.   Accountants provide for inflation using which of the following accounting principles?
a.
Going concern

b.
Time period

c.
Conservatism

d.
Materiality

e.
None of the answers are correct.

 
 
ANS:  E                    PTS:   1                    DIF:    Difficulty: Easy