External decision makers would not look primarily to financial accounting information to assist them in making decisions on
B. Capital budgeting
The primary focus for financial accounting information is to provide information useful for
A. Option A
Which of the following is not true about net operating cash flow?
B. t is a measure used in accrual accounting and is recognized as the best predictor of future operating cash flows
Which of the following was the first private sector entity that set accounting standards in the US?
B. Committee on Accounting Procedure
Which of the following does not apply to secondary markets?
B. New resources are provided when shares of stock are sold by the corporation to the initial owners.
Which of the following groups is not among the external users for whom financial statements are prepared
D. All of the above are external users of financial statements
In a recent annual report, Apple Computer reported the following in one of its disclosure notes:"Warranty Expense" This note exemplifies Apple's use of
B. The matching principle
Pronouncements issued by the Committee on Accounting Procedures
A. Dealt with specific accounting and reporting problems
The FASB's standard-setting process includes, in the correct order:
C. Research, discussion paper, exposure draft, Accounting Standards Update
Which of the following is not a provision of the Public Company Accounting Reform and Investor Protection Act of 2002 (Sarbanes-Oxley)? The Act:
D. Changed the entity responsible for setting accounting standards
The most likely important flaw leading to the demise of the APB was the perceived lack of:
The international Accounting Standards Board
C. Promotes the use of high-quality, understandable global accounting standards
The most political issue in the FASB's most recent deliberations and amendments to GAAP on business combinations was
A. The negative effects on subsequent earnings of amortizing goodwill if firms were required to use the purchase method of accounting for the combination
Which of the following is not a provision of the Public Company Accounting Reform and Investor Protection Act of 2002?
D. All of the above are provisions of the Act
The primary historical reason for the FASB reversing its positions when political pressures occur is
D. The SEC did not support the FASB position
The most recent example of the political process at work in standard setting is the heated debate that occurred on the issue of:
C. Accounting for business combinations
The recognition of which of the following expenses exemplifies the application of the matching principle
C. Cost of goods sold
The FASB's conceptual framework's qualitative characteristics of accounting information include
C. Faithful representation
The conceptual framework's qualitative characteristic of faithful representation includes:
The framework's recognition and measurement concepts recognize which of the following as an assumption, rather than a principle?
A. Going concern
The framework's recognition and measurement concepts recognize which of the following as a principle, rather than an assumption
D. Full disclosure
The primary objective of financial accounting information is to provide useful information to
D. None of the above
The main issue in the debate over accounting for employee stock options was
B. The amount of compensation expense that a company should recognize
Enhancing qualitative characteristics of accounting information include each of the following except
The enhancing qualitative characteristic of understandability means that information should be understood by
B. Those who have a reasonable understanding of business and economic activities
Fundamental qualitative characteristics of accounting information are
C. Faithful representation and relevance
Enhancing qualitative characteristics of accounting information include
B. Comparability and timeliness
When there is agreement between a measure or description and the phenomenon it purports to represent, information posses which characteristic?
C. Faithful representation
Surefeet Corporation changed its inventory valuation method. Which characteristic is jeopardized by this change?
Of the following, the most important objective for financial reporting is to provide information useful for
A. Making decisions
Land acquired in 2011 for a future building site at a cost of 40000. The land should be reported in the statements at
Maltec Corporation has started placing its quarterly financial statements on its web page, thereby reducing by ten days the time to get information to investors and creditors. The qualitative concept improved is
Recognizing expected losses immediately, but deferring expected gains, is an example of
The assumption that in the absence of contrary information a business entity will continue indefinitely is the
C. Going concern assumption
Which of the following Statements of Financial Accounting Concepts defines the 10 elements of financial statements
D. SFAC 6
The possibility that the capital markets' focus on periodic profits may tempt a company's management to bend or even break accounting rules to inflate reported net income is an example of
A. An ethical dilemma
One of the elements that many believe distinguishes a profession from other occupations is the acceptance by its members of a responsibility for the interests of those it serves, often articulated in
B. Its code of ethics
Primecoat Corporation could disseminate its annual financial statements two days if it shifted substantial human resources from other operations to the annual report project. Management decided the value of the earlier report was not worth the added commitment of the resources. The concept demonstrated is:
D. Cost effectiveness
If a company has gone bankrupt, its financial statements likely violate
D. The going concern assumption
Revenue should not be recognized until
A. The earnings process is complete and collection is reasonably assured
Which of the following is not an identified valuation technique in GAAP regarding fair value measurement?
C. Cost-benefit approach
Disclosure notes to a company's financial statements
C. Are an integral part of a company's financial statements
Which of the following best demonstrates the full disclosure principle?
D. Disclosure notes to financial statements
Four different competent accountants independently agree on the amount and method of reporting an economic event. The concept demonstrated is
To meet the needs of full disclosure, companies use supplemental information including
D. All of the above are correct