E2-7 (LO5,6)tices that have developed over time.(Assumptions, Principles, and Constraint) Presented below are a number of operational guidelines and prac-notteroige000 alInomInstructionsSelect the assumption, principle, or constraint that most appropriately justifies these procedures and practices. (Do not usequalitative characteristics.)(a) Fair value changes are not recognized in the accounting records.(b) Financial information is presented so that investors will not be misled.wol(c) Intangible assets are amortized over periods benefited.nemqinpsolsa onil" sto san od 0)Gdngbwcup op(d) Agricultural companies use fair value for purposes of valuing crops.(e) Each enterprise is kept as a unit distinct from its owner or owners.g theedmbureut(f) All significant post-balance-sheet events are disclosed.(g) Revenue is recorded when the product is delivered.(h) All important aspects of bond indentures are presented in financial statements.(i) Rationale for accrual accounting.wasAROWAenoitountendntine(j) The use of consolidated statements is justified.(k) Reporting must be done at defined time intervals.w 155Y odt ol gnibliud er) aopungb ori ogaarb of bobioob slloanos oni(1) An allowance for doubtful accounts is established.bro(m) Goodwill is recorded only at time of purchase.(n) A company charges its sales commission costs to expense.

SOLUTION ACCOUNTING PRINCIPLES ARE THE RULES AND GUIDELINES THAT COMPANIES MUST FOLLOW WHEN…

5,6) (Assumptions, Principles, and Constraint) Presented below are a number of operational guidelines and prac- ave developed over time. ns assumption, principle, or constraint that most appropriately justifies these procedures and practices. (Do not use characteristics.) woll ir value changes are not recognized in the accounting records. oboo dodnemqinpo olse or to sanod 0) nancial information is presented so that investors will not be misled. tangible assets are amortized over periods benefited. how.vlane gricultural companies use fair value for purposes of valuing crops. obs ch enterprise is kept as a unit distinct from its owner or owners. pdmburcur 1 significant post-balance-sheet events are disclosed. evenue is recorded when the product is delivered. l important aspects of bond indentures are presented in financial statements. tionale for accrual accounting. ne use of consolidated statements is justified. enoitounde eporting must be done at defined time intervals. n allowance for doubtful accounts is established. ambliud orl) ao podwill is recorded only at time of purchase. company charges its sales commission costs to expense.

5,6) (Assumptions, Principles, and Constraint) Presented below are a number of operational guidelines and prac- ave developed over time. ns assumption, principle, or constraint that most appropriately justifies these procedures and practices. (Do not use characteristics.) woll ir value changes are not recognized in the accounting records. oboo dodnemqinpo olse or to sanod 0) nancial information is presented so that investors will not be misled. tangible assets are amortized over periods benefited. how.vlane gricultural companies use fair value for purposes of valuing crops. obs ch enterprise is kept as a unit distinct from its owner or owners. pdmburcur 1 significant post-balance-sheet events are disclosed. evenue is recorded when the product is delivered. l important aspects of bond indentures are presented in financial statements. tionale for accrual accounting. ne use of consolidated statements is justified. enoitounde eporting must be done at defined time intervals. n allowance for doubtful accounts is established. ambliud orl) ao podwill is recorded only at time of purchase. company charges its sales commission costs to expense.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following statements is false? Select one: O A. Management accounting statements need not comply with Accounting regulations O B. Financial accounting statements normally reflect more detail than would be found in management accounting reports O C. Management accounting reports emphasise future activities and future costs O D. Financial accounting data are directed primarily at external users rather than internal users.
Choose the letter of the correct answer.
1A)Discuss the quality spectrum for assessing financial reporting quality.400-500 words 2B)Discuss the conditions that are conducive to issuing low-quality, or even fraudulent, financialreports
Current Attempt in Progress Companies that use GAAP do not have any guidelines as to what should be reported on their balance sheet. often offset assets against liabilities and report net assets and net liabilities on the balance sheet rather than the underlying detailed line items. O generally reported current assets before non-current assets on their balance sheet. O may report all their assets on their balance sheet at fair value.
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Which one of the following statements is not correct regarding financial accounting and management accounting? O a. Financial accounting reports need to be audited to verify their accuracy unlike management accounting reports which do not need to be audited. O b. Only financial accounting involves the use of accounting information. Management accounting information emphasize supporting decisions that affect the future unlike financial accounting information, which focus on the consequences of past activities of the organization. O c. O d. None of the given answers Financial accounting needs to follow specific set of rules called accounting standards unlike management accounting O e.
True or False 6. Entities may apply a simplified approach when recognizing impairment losses on trade receivables7. When there is a significant increase in the credit risk of a financial asset since its initial recognition but there is no objective evidence of impairment, interest revenue is computed on the net carrying amount of the financial asset (i.e. gross carrying amount less loss allowance)8. an entity recognizes impairment gain when there is an improvement in the credit quality of a previously impaired financial asset9.According to IFRS 9, expected credit losses are weighted average of credit losses with the respective risks of a default occurring as the weights10. a financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occured
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Which of the following is not correct about Going Concern? a. The concept of going concern is an underlying assumption in the preparation of financial statements O b. The financial statements presume that the entity is a going concern and will continue its operations for the foreseeable future O C. Assume that the business will continue to operate long enough to carry out its current obligations, objectives and commitments O d. The concept of going concern is a conservative in the preparation of financial statements
Misappropriation of assets: Select one: a. causes harm to stockholders because the assets are no longer available to their rightful owners b. causes the financial statements to be misstated since the misappropriation usually involves material amounts c. is generally committed by company management d. harms the users of the financial statements by providing them incorrect financial data for their decision making
S1: For financial reporting purposes, an entity’s risk assessment process includes its identification, analysis, and management of risks relevant to the preparation of financial statements in accordance with applicable financial reporting framework.S2: The risk of material misstatement is broader in scope compared to business risks. Group of answer choices Both S1 and S2 are correct. Only S1 is correct. Both S1 and S2 are incorrect. Only S2 is correct.
The fundamental qualitative characteristics that financial information must possess to be useful to theprimary users of general purpose financial reports—identified in the Conceptual Framework are‘relevance’ and ‘faithful representation’.Required:a) Provide one example where information is relevant but not faithfully represented. (maximum 100 words)b) Provide one example where information is not relevant but is faithfully represented.(maximum 100 words)c) Provide one example where information is relevant and faithfully represented.