TEST BANK FOR
Financial Reporting and Analysis, 13th Edition Charles H. Gibson Chapter 1-13 CHAPTER 1—INTRODUCTION TO FINANCIAL REPORTING MULTIPLE CHOICE 1. Charging off equipment that cost less than $20 would be an example of the application of: a. going concern. b. cost. c. matching. d. materiality. e. realization. ANS: D 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. 2. The going concern assumption: a. is applicable to all financial statements. b. primarily involves periodic income measurement. c. allows for the statements to be prepared under generally accepted accounting principles. d. requires that accounting procedures be the same from period to period. e. none of the answers are correct. ANS: C PTS: 1 DIF: Difficulty: Moderate 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. 3. Understating assets and revenues is justified based on: a. realization assumption. b. matching. c. consistency. d. realization. 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.