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  • Chapter 5 - Accounting Principles and End-Of-period Adjustments

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    sablu khan
    148 Ansichten3 Seiten
    Accounting principles and endofperiod adjustments Multiple Choice Identify the choice that best completes the statement or answers the question. Which principle specifies that cost or expenses should be recorded at the same time as the revenue to which they correspond. Which measurement basis is most commonly used by enterprises to prepare the financial statements.

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    Accounting principles and endofperiod adjustments Multiple Choice Identify the choice that best completes the statement or answers the question. Which principle specifies that cost or expenses should be recorded at the same time as the revenue to which they correspond. Which measurement basis is most commonly used by enterprises to prepare the financial statements.

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    148 Ansichten3 Seiten

    Chapter 5 - Accounting Principles and End-Of-period Adjustments

    Hochgeladen von

    sablu khan
    Accounting principles and endofperiod adjustments Multiple Choice Identify the choice that best completes the statement or answers the question. Which principle specifies that cost or expenses should be recorded at the same time as the revenue to which they correspond. Which measurement basis is most commonly used by enterprises to prepare the financial statements.

    Copyright:

    © All Rights Reserved
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    Chapter5Accountingprinciplesandendofperiodadjustments
    MultipleChoice
    Identifythechoicethatbestcompletesthestatementoranswersthequestion.

    1.Whichprinciplespecifiesthatcostorexpensesshouldberecordedatthesametimeas
    therevenuetowhichtheycorrespond?
    a. Prudenceprinciple
    b. Matchingprinciple
    c. Goingconcernprinciple
    d. Consistencyprinciple
    ANSWER:B
    Easy
    POINTS: 0/1
    REF:
    page156

    2.Whichmeasurementbasisismostcommonlyusedbyenterprisestopreparethefinancial
    statementsbecauseitistheonethatrequiresthefewesthypotheses?
    a. Historicalcost
    b. Realizablevalue
    c. Replacementcost
    d. Presentvalue
    ANSWER:A
    Easy
    POINTS: 0/1
    REF:
    page169

    3.Abusinessowesasupplier500CUandsimultaneouslyhasaclaimonthatverysupplier
    forthesameamount.Whatshouldbereportedinthebalancesheet?
    a. Nothing.
    b. Onlyabalanceof500CUontheliabilityside(correspondingtothedebttothe
    supplier).
    c. Onlyabalanceof500CUontheassetside(correspondingtotheclaimonthe
    supplier).
    d. Abalanceof500CUontheassetsideandabalanceof500ontheliabilityside.
    ANSWER:D
    Easy
    POINTS: 0/1
    REF:
    page160

    4.Transactionsandothereventsareaccountedforandpresentedinaccordancewith:
    a. Theirlegalform.
    b. Theirmateriality.
    c. Theirsubstanceandeconomicreality.
    d. Theirtaximpact.
    ANSWER:C

    Easy
    POINTS: 0/1
    REF:
    page160

    5.Whichofthefollowingstatementsisnotconsistentwiththefactthatvaluationmustbe
    madeonaprudentbasis?
    a. Onlyprofitsconcretelyanddefinitivelyearnedonthebalancesheetdatemaybe
    included.
    b. Ifnecessary,thecreationofexcessiveprovisionsorthedeliberateoverstatement
    ofassetsisallowed.
    c. Accountmustbetakenofallforeseeableliabilitiesandpotentiallossesarising
    inthecourseofthefinancialyearconcernedorofapreviousone,evenifsuch
    liabilitiesorlossesbecomeapparentonlybetweenthedateofthebalancesheet
    andthedateonwhichitisdrawnup.
    d. Accountmustbetakenofalldepreciationwhethertheresultofthefinancial
    yearisalossoraprofit.
    ANSWER:B
    Easy
    POINTS: 0/1
    REF:
    page161

    6.Whenwilltheendofperiodentriesbecarriedout?
    a. Everytimethebooksareclosed
    b. Everytimeanentryisrecorded
    c. Whenthebusinessisliquidated
    d. Everytimeamajoreventisrecognized
    ANSWER:A
    Moderate
    POINTS: 0/1
    REF:
    page164

    7.Whendorevenuesaffectnetincome?
    a. Intheperiodduringwhichtheyareearned
    b. Intheperiodinwhichtheircashequivalentiscollected
    c. Bothaandb
    d. Neitheranorb
    ANSWER:A
    Easy
    POINTS: 0/1
    REF:
    page165

    8.Interestrevenueonaloangrantedtoanemployeebecomesdueontheanniversaryof
    theloan,31March.Theannualinterestontheloanis120CU.Howmuchisrecordedin
    theincomestatementasof31December?
    a. 0
    b. 30
    c. 60
    d. 90
    ANSWER:D
    Easy
    POINTS: 0/1
    REF:
    pages165,166

    REF:

    pages165,166

    9.Whateffectdoestheendofperiodentryrecognizingperiodicdepreciationhaveonthe
    basicaccountingequation?
    a. Decreaseinassets,decreaseinliabilities
    b. Decreaseinassets,increaseinshareholdersequity
    c. Decreaseinassets,increaseinliabilities
    d. Decreaseinassets,decreaseinshareholdersequity
    ANSWER:D
    Moderate
    POINTS: 0/1
    REF:
    page168

    10.Theopeningbalancesheetforeachfinancialyearmustcorrespondtotheclosing
    balancesheetfortheprecedingfinancialyear.
    a. True
    b. False
    ANSWER:A
    Easy
    POINTS: 0/1
    REF:
    page178

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