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
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.