Question 1

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Financial Accounting Standards Board
A)Its EITF Issues are GAAP when entered in the Accounting Standards Codification.
B)It is the national organization for CPAs in the United States.
C)It has the authority to set U.S. accounting standards.
D)It established GAAP before the FASB.
E)Undermines representational faithfulness by being inconsistent with neutrality.

Accepted Answer

The answer of Listed below are five terms followed by...

Question 2

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Going concern assumption
A)Implies consensus among different observers.
B)Assumes an entity will continue to operate indefinitely.
C)Ignores the possibility of inflation.
D)Assumes all transactions can be identified with a particular entity.
E)Requires reporting the financial life of an entity in discrete time frames.

Accepted Answer

The going concern assumption in accounting means that it is assumed an entity will continue to operate indefinitely, not going into liquidation or significantly curtailing its operational capabilities. This assumption underlies the preparation of financial statements.

Question 3

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Assets
A)Net outflows from peripheral transactions.
B)Probable future economic benefits controlled by an entity.
C)Results if an asset is sold for more than book value.
D)Increases in equity from the sale of goods and/or services.
E)All changes in equity except owner transactions.

Accepted Answer

Assets are defined as probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.

Question 4

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Equity
A)Net assets.
B)Transfers of resources in exchange for common and preferred stock.
C)Claims of creditors against the assets of a business.
D)Outflows of resources to generate revenues.
E)Cash dividends.

Accepted Answer

Equity is often represented by net assets, which is the residual interest in the assets of an entity after deducting liabilities.

Question 5

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Securities and Exchange Commission
A)Its EITF Issues are GAAP when entered in the Accounting Standards Codification.
B)It is the national organization for CPAs in the United States.
C)It has the authority to set U.S. accounting standards.
D)It established GAAP before the FASB.
E)Undermines representational faithfulness by being inconsistent with neutrality.

Accepted Answer

The Securities and Exchange Commission (SEC) has the authority to set U.S. accounting standards, although it typically delegates this responsibility to the Financial Accounting Standards Board (FASB).

Question 6

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-American Institute of CPAs (AICPA)
A)Its EITF Issues are GAAP when entered in the Accounting Standards Codification.
B)It is the national organization for CPAs in the United States.
C)It has the authority to set U.S. accounting standards.
D)It established GAAP before the FASB.
E)Undermines representational faithfulness by being inconsistent with neutrality.

Accepted Answer

The American Institute of CPAs (AICPA) is the national professional organization for Certified Public Accountants (CPAs) in the United States, which supports the CPA profession with research, a rigorous code of professional ethics, education, and guidance.

Question 7

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Investments by owners
A)Net assets.
B)Transfers of resources in exchange for common and preferred stock.
C)Claims of creditors against the assets of a business.
D)Outflows of resources to generate revenues.
E)Cash dividends.

Accepted Answer

Investments by owners refer to the resources that owners put into a company, typically in exchange for shares of the company's stock, which is accurately described by option B.

Question 8

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Materiality
A)Basis of measurement for fixed assets.
B)Reporting of all information that could affect decisions.
C)Occurs when goods or services are transferred to the customer.
D)Discounts future cash flows.
E)Application of GAAP sometimes avoided under this constraint.

Accepted Answer

The answer of Listed below are five terms followed by...

Question 9

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Revenue recognition
A)Basis of measurement for fixed assets.
B)Reporting of all information that could affect decisions.
C)Occurs when goods or services are transferred to the customer.
D)Discounts future cash flows.
E)Application of GAAP sometimes avoided under this constraint.

Accepted Answer

Revenue recognition occurs when goods or services are transferred to the customer, reflecting the point at which the seller can record the revenue generated from the transaction.

Question 10

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Expenses
A)Net assets.
B)Transfers of resources in exchange for common and preferred stock.
C)Claims of creditors against the assets of a business.
D)Outflows of resources to generate revenues.
E)Cash dividends.

Accepted Answer

Expenses are outflows of resources to generate revenues, which matches description D.

Question 11

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Accounting Principles Board
A)Its EITF Issues are GAAP when entered in the Accounting Standards Codification.
B)It is the national organization for CPAs in the United States.
C)It has the authority to set U.S. accounting standards.
D)It established GAAP before the FASB.
E)Undermines representational faithfulness by being inconsistent with neutrality.

Accepted Answer

The Accounting Principles Board (APB) was the body that established Generally Accepted Accounting Principles (GAAP) in the United States before the Financial Accounting Standards Board (FASB) took over its role.

Question 12

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Present value
A)Basis of measurement for fixed assets.
B)Reporting of all information that could affect decisions.
C)Occurs when goods or services are transferred to the customer.
D)Discounts future cash flows.
E)Application of GAAP sometimes avoided under this constraint.

Accepted Answer

Present value is calculated by discounting future cash flows to understand their worth in today's dollars, which is what choice D describes.

Question 13

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Distributions to owners
A)Net assets.
B)Transfers of resources in exchange for common and preferred stock.
C)Claims of creditors against the assets of a business.
D)Outflows of resources to generate revenues.
E)Cash dividends.

Accepted Answer

Distributions to owners, such as cash dividends, represent the outflows of resources (like cash) from a business to its owners. These distributions reduce the equity of the business but do not directly relate to the generation of revenues, acquisition of stock, claims of creditors, or net assets in the context of operational activities.

Question 14

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Historical cost
A)Basis of measurement for fixed assets.
B)Reporting of all information that could affect decisions.
C)Occurs when goods or services are transferred to the customer.
D)Discounts future cash flows.
E)Application of GAAP sometimes avoided under this constraint.

Accepted Answer

Historical cost is primarily associated with the valuation and reporting of fixed assets at their original purchase price.

Question 15

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Full disclosure
A)Basis of measurement for fixed assets.
B)Reporting of all information that could affect decisions.
C)Occurs when goods or services are transferred to the customer.
D)Discounts future cash flows.
E)Application of GAAP sometimes avoided under this constraint.

Accepted Answer

Full disclosure in accounting means the reporting of all information that could affect decisions made by users of the financial statements. This includes any relevant financial and non-financial information.

Question 16

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Liabilities
A)Net assets.
B)Transfers of resources in exchange for common and preferred stock.
C)Claims of creditors against the assets of a business.
D)Outflows of resources to generate revenues.
E)Cash dividends.

Accepted Answer

Liabilities are the claims of creditors against the assets of a business.

A) Net assets refer to the total value of assets minus the total value of liabilities, therefore this phrase does not describe liabilities.

B) Transfers of resources in exchange for common and preferred stock are more closely associated with equity, not liabilities.

D) Outflows of resources to generate revenues refer to expenses, which are not liabilities.

E) Cash dividends are distributions made to shareholders from the company's earnings, and are not related to liabilities.

Question 17

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Revenues
A)Net outflows from peripheral transactions.
B)Probable future economic benefits controlled by an entity.
C)Results if an asset is sold for more than book value.
D)Increases in equity from the sale of goods and/or services.
E)All changes in equity except owner transactions.

Accepted Answer

Revenues are increases in equity from the sale of goods and/or services.

A) Net outflows from peripheral transactions describe expenses. 
B) Probable future economic benefits controlled by an entity describe assets. 
C) Results if an asset is sold for more than book value describe gains. 
E) All changes in equity except owner transactions describe comprehensive income.

Question 18

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Periodicity assumption
A)Implies consensus among different observers.
B)Assumes an entity will continue to operate indefinitely.
C)Ignores the possibility of inflation.
D)Assumes all transactions can be identified with a particular entity.
E)Requires reporting the financial life of an entity in discrete time frames.

Accepted Answer

The periodicity assumption in accounting requires that the financial life of an entity be reported in discrete time frames, such as monthly, quarterly, or annually, to allow for the preparation of financial statements and performance analysis over specific periods.

Question 19

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Conservatism
A)Its EITF Issues are GAAP when entered in the Accounting Standards Codification.
B)It is the national organization for CPAs in the United States.
C)It has the authority to set U.S. accounting standards.
D)It established GAAP before the FASB.
E)Undermines representational faithfulness by being inconsistent with neutrality.

Accepted Answer

Conservatism in accounting refers to the principle of exercising caution in financial reporting and choosing methods that minimize the possibility of overstating assets or income. This principle can undermine representational faithfulness by being inconsistent with neutrality, as it may bias financial statements towards more conservative estimates.

Question 20

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Losses
A)Net outflows from peripheral transactions.
B)Probable future economic benefits controlled by an entity.
C)Results if an asset is sold for more than book value.
D)Increases in equity from the sale of goods and/or services.
E)All changes in equity except owner transactions.

Accepted Answer

Losses are net outflows from peripheral transactions, meaning they are decreases in equity from incidental or non-primary business activities.

Quiz 1: Environment and Theoretical Structure of Financial Accounting

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Financial Accounting Standards Board

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Going concern assumption

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Assets

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Equity

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Securities and Exchange Commission

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -American Institute of CPAs (AICPA)

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Investments by owners

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Materiality

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Revenue recognition

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Expenses

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Accounting Principles Board

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Present value

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Distributions to owners

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Historical cost

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Full disclosure

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Liabilities

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Revenues

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Periodicity assumption

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Conservatism

Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term. -Losses