6. Application of the full disclosure principlea. Is theoretically desirable but not practical.b. Is violated when important financial information jeburied in the notes to financial statements.c. Is demonstrated by the use of supplementaryinformation presenting the effects of changing prices..d. Requires that the financial statements should beconsistent and comparable.7. Accounting policies disclosed in the notes to financialstatements typically include all of the following, excepta. The cost flow assumptionb. The depreciation methodc. Significant estimatesd. Significant inventory purchasing policies8. Significant accounting policies may not bea. Selected on the basis of judgment.b. Selected from existing acceptable alternatives.c. Unusual ór innovative in application.d. Omitted from financial statement disclosure.9. An inventory accounting policy that should be disclosedin a summary of significant accounting policies isa. Composition of inventory into raw materials,work in process and finished goodsb. Major backlog of inventory ordersc. Method used for pricing inventoryd. All of these should be disclosed in the summary ofsignificant accounting policies.10. Which of the following should be disclosed in a şummaryof significant accounting policies?a. Type of executory contractb. Cumulative effect of change in accounting policyc. Claims of equity holdersd. Depreciation method

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6. Application of the full disclosure principle a. Is theoretically desirable but not practical. b. Is violated when important financial information je buried in the notes to financial statements. Is demonstrated by the use of supplementary information presenting the effects of changing prices.. d. Requires that the financial statements should be consistent and comparable.

6. Application of the full disclosure principle a. Is theoretically desirable but not practical. b. Is violated when important financial information je buried in the notes to financial statements. Is demonstrated by the use of supplementary information presenting the effects of changing prices.. d. Requires that the financial statements should be consistent and comparable.

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 given options, is a limitation of financial reporting? (choose one answer only) a. financial reports can only provided all information needed by its primary users not other users b. financial reports are based on estimates and judgments rather that exact depiction c. financial reports can only provide information to help primary users estimate the value of the entity d. all of these are limitations of financial reporting
Choose the letter of the correct answer.
What is not a financial statement assertion are:a. Accuracyb. Completenessc. Presentation and disclosured. Occurrence
9. Technical analysts feel that financial accounting statements lack information, or report it in a way that makes comparisons difficult. Which of the following does not constitute a problem? a. Detailed information concerning sales and expenses by product line. b. Statements of change in financial position. c. Alternative ways of reporting expenses. d. Alternative ways of reporting assets and liabilities. e. The availability of psychological and nonquantitative variables.
true or false. No material misstatements are allowed if financial statements are to called fairly presented?
Which of the following statements about the process of developing a reformulated Balance Sheet is NOT correct? O 1. Derivative financial liabilities should be classified as financial obligations O 2. Lease interest should be classified as a financial expense O 3. Preference shares should be classified as a financial obligation O 4. Every asset can be clearly classified as an operating asset or financial asset. There is no judgement or uncertainty involved
Accounting for Securitization under SFAS No. 140 (2000) is a limited attempt to describe complex transactions that are structured to yield desired economic and accounting outcomes. This accounting raises three issues for users of financial reports. State these three issues.
Question: How does the Conceptual Framework for Financial Reporting reconcile the tensions between historical cost accounting and fair value accounting, and how does it strike a balance between providing relevant information for decision-making while ensuring the faithful representation of financial transactions in volatile and uncertain economic environments? ?
An item or information is considered MATERIAL in accounting if a. Its non-disclosure would influence the decisions of the users of financial statements b. Its non-disclosure would not influence the decisions of the users of financial statements c. Both of the options d. None of the options
Auditors commonly allocate materiality to balance sheet accounts rather than income statement accounts because most income statement misstatements have a effect on the balance sheet. Select one: a. equal b. undetermined C. increased d. reduced O O O