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Week 3 Quiz 2: Chapters 2 and 3
Chapter 2
Multiple Choice
1.
Which early accounting theorist was among the first to express the view that
all changes in the value of assets and liabilities should be reflected in the
financial statements ?\
a. A.
C. Littleton
b. John
Canning
c. William
Paton
d. DR
Scott
Answer
2. Which
of the following economists most influenced the views of DR Scott?
a. Thorstein
Veblen
b. John
Hicks
c. Karl
Marx
d. John
Smith
Answer
3. Which
of the following is not one of DR Scott’s hierarchy of accounting postulates
and principles?
a. Orientation postulate.
b.
The principles of
truth and fairness.
c.
The materiality
principle
d.
The principles of
adaptability and consistency.
Answer
4. Which of the
following organizations published the monograph titled A Tentative Statement of
Accounting Principles Affecting Annual Corporate Reports
a.
SEC
b.
AAA
c.
AIA
d.
NAA
Answer
5. Which of the following organizations published the
monograph titled A Statement of
Accounting Principles?
a.
SEC
b.
AAA
c.
AIA
d.
NAA
Answer
6. Who was the author of Accounting Research Study No. 1,
The Basic Postulates of Accounting?
a. Robert Sprouse
b. Maurice Moonitz
c. Alvin Jennings\
d. Thomas Hatfield
Answer
7. Which of the following is not an approaches to
accounting theory AS categorized by Statement
on Accounting Theory and Theory Acceptance?
a. Classical,
b. Neoclassical
c. Decision usefulness
d. Information economics.
Answer
8.
Under Statement
of Financial Accounting Concepts No. 2, feedback value is an ingredient of the
primary quality o
Relevance Reliability
a.
No No
b. No Yes
c. Yes Yes
d. Yes No
Answer
9. Under
Statement of Financial Accounting Concepts No. 2, which of the following
interacts with both relevance and reliability to contribute to the usefulness
of information?
a. Comparability
b. Timeliness
c. Neutrality
d. Predictive
value
Answer
10. Which
of the following hierarchy of qualities did Statement of Financial Accounting
Concepts No. 2 indicate as being most important?
a. Relevance
b. Reliability
c. Verifiability
d. Decision
usefulness
Answer
11. Which
of the following is considered a
pervasive constraint by Statement of Financial Accounting Concepts No. 2
a. Benefits>costs
b. Conservatism
c. Timeliness
d. Verifiability
Answer
12. Under
Statement of Financial Accounting Concepts No. 2, which of the following is an
ingredient of the primary quality of relevance?
a. Predictive
value
b. Materiality
c. Understandability
d. Verifiability
Answer
13. Under
Statement of Financial Accounting Concepts No. 2, which of the following is an
ingredient of the primary quality of reliability?
a. Understandability
b. Verifiability
c. Predictive
value
d. Materiality
Answer
14. Under
Statement of Financial Accounting Concepts No. 2, the ability through consensus
of measures to ensure that information represents what it purports to represent
is an example of the concept of
a. Relevance
b. Verifiability
c. Representational
faithfulness
d. Feedback
value
Answer
15. Under
Statement of Financial Accounting Concepts No. 2, which of the following
relates to both relevance and reliability?
a. Timeliness
b. Materiality
c. Verifiability
d. Neutrality
Answer
16. Which
of the following is not a
qualitative characteristic associated with reliability?
a. Verifiable
b. Conservatism
c. Neutral
d. Faithful representation
Answer
17. An item is considered material if
a. It doesn’t costs a lot of money.
b. It is of a tangible good.
c. It is likely to influence the decision of an
investor or creditor.
d. The cost of reporting the item is greater
than its benefits
Answer
Essay
1.
Discuss the contributions of Paton and
Canning to the development of accounting theory.
2.
Discuss DR Scott’s hierarchy of
postulates and principles.
3.
Discuss the contributions of the works
by Sanders Hatfield and More, and Paton and Littleton to accounting theory.
4.
Discuss accounting Research Study No. 1.
5.
Discuss the objectives of accounting as
outlined by the T rueblood Committee.
6.
What were the approaches to accounting
theory identified by SATTA?
7.
According to Kuhn, how dies scientific
progress occur?
8.
What is the purpose of the conceptual
framework?
9.
List the objectives of financial
accounting as outlined in SFAC No 1: “Objective of Financial Reporting by
Business Enterprises.
10.
What quality of information is viewed as
the most important in SFAC No. 2: Qualitative Characteristics of Accounting
Information?
11.
Define the following terms:
a. Relevance
.
b. Reliability
12. According to SFAC
No. 5, what should a full set of financial statements for a period show?
13. What is the purpose of SFAC No. 7: “Using Cash Flow
Information and Present Value in Accounting Measurements?
14. What two approaches to present value were discussed in
SFAS No. 7?
15. Discuss the issue of principles based vs. rule based
accounting standards.
16. Discuss how the FASB and the IASC acted to improve
comparability under the Norwalk Agreement.
Example Test Questions
Chapter
3
Multiple Choice
1. Which
of the following is not an environmental actor that could impact on the
development of a country’s accounting system?
a. Level
of education\
b. Political
system
c. Geographic
location
d. Legal
system
Answer
2. What is the current acronym for the body most
responsible for issuing international accounting standards?
a. IASB
b. SEC
c. FASB
d. IASC
Answer
3. How
many trustees serve on the IASC Foundation?
a. 14
b. 18
c. 20
d. 22
Answer
4. How
many members serve on the IASB?
a.
14
b.
18
c.
20
d.
22
Answer
5. Which
of the following bodies has the responsibility to issue international
financial reporting standards (IFRS)
a.
The International
Financial Reporting Interpretations Committee
b.
The
International Standards Advisory Council
c.
The IASC
Foundation
d.
The International
Accounting Standards Board
Answer
6. Which
of the following is not a use of international accounting standards?
a.
As national
requirements.
b.
As standards to
be violated to improve intercountry comparability..
c.
As an
international benchmark for those countries that develop their own
requirements.
d.
By regulatory
authorities for domestic and foreign companies
Answer
7.
How does the IASC
enforce its standards?
a.
Through , the
International Organization of Securities Commission
b.
Through the
concept of best endeavors
c.
Through the
Securities and Exchange Commission
d.
Through the
Financial Accounting Standards Board
Answer
8. What is the name given to the agreement between the
FASB and IASC to harmonize accounting standards?
a. The Norwalk Agreement
b. The London agreement
c. The Washing ton
D C agreement
d. The Paris Accords
Answer
9. What is the title of the form that foreign companies
have used to reconcile their financial statements to U. S. GAAP?
a.
Form 10-K
b.
Form 10-Q
c.
Form SX
d.
Form20-F
Answer
10. Which of the following is not a qualitative
characteristic contained in the IASB’s Framework
for the Preparation of Financial Statements?
a. Understandability
b. Timeliness
c. Relevance
d. Reliability
Answer
11. Which of the following is not an element of financial
statements contained in the IASB’s Framework
for the Preparation of Financial Statements?
a.
Gain
b.
Income
c.
Expense
d.
Asset
Answer
12. Which of the
following is seen as a pervasive difference between IASB’s and FASB’s
Conceptual Frameworks?
a. Definition of elements
b. Number of qualitative characteristics
c. Scope of authority
d. Level of detail
Answer
13. Which of the following concepts is contained in the
FASB’s conceptual framework but not in
the IASC’s
a. Expense
b.
Comprehensive
income
c.
Asset
d.
Liability
Answer
Essay
1.Discuss
the environmental factors that impact on the development of a country’s
accounting system.
2. Discuss
the approaches a company might take when issuing financial reports to users in
foreign countries.
3.
What is the purpose of the International
Accounting Standards Board?
4. Discuss
the factors that have contributed to the need for new approaches to
international standard setting.
5.
Discuss the IASB’s annual improvements
project..
6.
Discuss
the composition and role of The
International Accounting Standards Board..
7.
Discuss
the role of The International Financial
Reporting Interpretations Committee
8.
How are IASB
standards used by various countries?
9.
Discuss the Short-term International Convergence Project
10. Discuss
the IASB-FASB Norwalk agreement.
11. List
the milestones contained in the FASB-IASB Roadmap Convergence Project.
12. What
is the objective of the joint FASB-IASB Convergence Project?
14.
Under rules enacted prior to 2007, how
could a foreign company list its
securities for sale in U. S. capital markets? How did this rule change?
15. Discuss
the objectives of accounting as defined by the IASB’s Framework for the
Preparation of Financial Statements
16. Discuss
the qualitative characteristics of accounting information as defined by the
IASB’s
17. Discuss
the elements of financial statements defined by the IASB’s Framework for the
Preparation of Financial Statements.
18. Discuss the concepts of capital and capital
maintenance discussed in the Framework
for the Preparation of Financial Statements.
19. Discuss IFRS No. 1, “First Time Adoption of
International Reporting Standards.
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