1. Which one of the following can be recognized as an asset in the financial statements in accordance with the Conceptual Framework? a. P2,000 paid to train staff members b. P70,000 research costs that may result in the development of a new product c. a P100,000 contract with a customer to deliver goods at a specified date in the future d. the P2 million transfer fee paid by a basketball team to acquire a player on contract from another team. 2. Users of Augustus Corp. financial statements can compare the market price used to measure its equity shareholding in Constantine Corp., a listed company to that compahy's quoted share price as at the reporting date. Which characteristic of financial information does this reflect? a. timeliness b. verifiability c. comparability d. understandability 3. The role of financial reporting is to provide users with information to enable them to make effective decisions. Which of the following groups of users are general purpose financial reports specifically prepared for according to the Conceptual Framework? a. lenders, investors and tax authorities b. investors, potential investors and creditors c. employees, tax authorities and shareholders d. shareholders, lenders and government bodies
1. Which one of the following can be recognized as an asset in the financial statements in accordance with the Conceptual Framework? a. P2,000 paid to train staff members b. P70,000 research costs that may result in the development of a new product c. a P100,000 contract with a customer to deliver goods at a specified date in the future d. the P2 million transfer fee paid by a basketball team to acquire a player on contract from another team. 2. Users of Augustus Corp. financial statements can compare the market price used to measure its equity shareholding in Constantine Corp., a listed company to that compahy's quoted share price as at the reporting date. Which characteristic of financial information does this reflect? a. timeliness b. verifiability c. comparability d. understandability 3. The role of financial reporting is to provide users with information to enable them to make effective decisions. Which of the following groups of users are general purpose financial reports specifically prepared for according to the Conceptual Framework? a. lenders, investors and tax authorities b. investors, potential investors and creditors c. employees, tax authorities and shareholders d. shareholders, lenders and government bodies
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Multiple Choice
1. Which one of the following can be recognized as an asset in the financial statements
in accordance with the Conceptual Framework?
a. P2,000 paid to train staff members
b. P70,000 research costs that may result in the development of a new product
c. a P100,000 contract with a customer to deliver goods at a specified date in the
future
d. the P2 million transfer fee paid by a basketball team to acquire a player on
contract from another team.
2. Users of Augustus Corp. financial statements can compare the market price used to
measure its equity shareholding in Constantine Corp., a listed company to that
compahy's quoted share price as at the reporting date.
Which characteristic of financial information does this reflect?
a. timeliness
b. verifiability
c. comparability
d. understandability
3. The role of financial reporting is to provide users with information to enable them to
make effective decisions. Which of the following groups of users are general purpose
financial reports specifically prepared for according to the Conceptual Framework?
a. lenders, investors and tax authorities
b. investors, potential investors and creditors
C. employees, tax authorities and shareholders
d. shareholders, lenders and government bodies
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