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
NAT: BUSPROG: Communication