Question : 1.One concept of income suggests that income be measured by : 1242768

Accounting

1.One concept of income suggests that income be measured by determining the net change over time in the discounted present value of net cash flow expected to be received by the firm. Under this concept of income, which of the following, ignoring income taxes would not affect the amount of income for a period?

a.Providing services to outsiders and investments of the funds received

b.Production of goods or services not yet sold not yet delivered to customers or clients.

c.Windfall gains and losses due to external causes.

d.The method used to depreciate property, plant and equipment.

2.The term revenue recognition conventionally refers to

a.The process of identifying transactions to be recorded as revenue in an accounting period.

b.The process of measuring and relating revenue and expenses of an enterprise for an accounting period.

c.The earning process that gives rise to revenue realization.

d.The process of identifying those transactions that result in an inflow of assets from customers.

3.In the transactions approach to income determination, income is measured by subtracting the expenses resulting from specific transactions during the period from revenues of the period also resulting from transactions. Under a strict transactions approach to income measurement, which of the following would not be considered a transaction?

a.Sale of goods on account at 20 percent markup

b.Exchange of inventory at a regular selling price for equipment

c.Adjustment of inventory in lower of cost or market inventory valuations when market is below cost.

d.Payment of salaries

4.Conventionally accountants measure income

a.By applying a value added concept

b.By using a transactions approach

c.As a change in the value of owners’ equity

d.As a change in the purchasing power of owners’ equity

5.Arid Lands, Inc. is engaged in extensive exploration for water in the Caprock Desert. If upon discovery of water the corporation does not recognize any revenue from water sales until the sales exceed the costs of exploration, the basis of revenue recognition being employed is the

a.Production basis

b.Cash (or collection) basis

c.Sales (or accrual) basis

d.Sunk cost (or cost recovery) basis

6.The installment method of recognizing revenue is not acceptable for financial reporting if

a.The collectability of the sales price is reasonably assured

b.The installment period is less than 12 months

c.The method is applied to only a portion of the total

d.Collection expenses can be reasonably predicted

7.The principal disadvantage of using the percentage of completion method of recognizing revenue from long-term contracts is that it

a.Is unacceptable for income tax purposes

b.May require that intraperiod tax allocation procedures be used

c.Gives results bases upon estimates that may be subject to considerable uncertainty

d.Is likely to assign a small amount of revenue to a period during which much revenue was actually earned

8.One of the basic features of financing accounting is the

a.Direct measurement of economic resources and obligations and changes in them in terms of money and sociological and psychological impact

b.Direct measurement of economic resources and obligations and changes in them in terms of money

c.Direct measurement of economic resources and obligations and changes in them in terms of money and sociological impact

d.Direct measurement of economic resources and obligations and changes in them in terms of money and psychological impact

9. Which of the following is an argument against using historical cost in accounting?

a. Fair values are more relevant.

b.Historical costs are based on an exchange transaction.

c.Historical costs are reliable.

d.Fair values are subjective

10. The basic accounting concept that refers to the tendency of accountants to resolve uncertainty in favor of understating assets and revenues and overstating liabilities and expenses is known as

a.the nocturne of conservatism.

b.the materiality constraint.

c.the substance over form principle.

d.the industry practices constraint.

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July 1, 2023

9.1 The United States in the International Economy

1) Following the tariff imposed on Chinese tires, some businesspeople correctly argued that the U.S. tariff would result in

A) China retaliating by raising tariffs on some U.S. exports.

B) China halting the sale of all products in the United States.

C) U.S. firms never being able to meet the demand for U.S.-produced tires.

D) the government demanding price cuts from U.S. tire manufacturers.

2) Workers in industries protected by tariffs and quotas are likely to support these trade restrictions because

A) they do not want to offend their employers who want them.

B) politicians lobby to convince workers the restrictions will make them better off.

C) they believe the restrictions will protect their jobs.

D) they don't understand that the restrictions will threaten their jobs.

3) The intention of the U.S. tariff on Chinese tires was to

A) protect jobs in the U. S. tire industry.

B) protect infant industries in tire U.S. tire market.

C) insure that Chinese tires meet U.S. quality and safety standards.

D) save the government money by restricting the sale of more expensive Chinese-made tires.

4) In the 1930s, the United States charged an average tariff rate ________. Today, the rate is ________.

A) of 100 percent; 20 percent

B) above 50 percent; less than 1.5 percent

C) of less than 10 percent; over 40 percent

D) of 17 percent; 33 percent

5) A tariff is a tax imposed by a government on

A) exports.

B) services.

C) imports.

D) luxury items.

6) Goods and services bought domestically but produced in other countries are referred to as

A) exports.

B) imports.

C) transfer payments.

D) foreign consumption.

7) Exports are domestically produced goods and services

A) sold to other countries.

B) sold to the government.

C) sold at home.

D) which are used to produce other goods and services.

8) When Roxanne, a U.S. citizen, purchases a designer dress from Barneys of New York that was made in Milan, the purchase is

A) both a U.S. and an Italian import.

B) a U.S. import and an Italian export.

C) a U.S. export and an Italian import.

D) neither an export nor an import for either country.

9) When BMW, a German company, purchases a welding machine that was made in Toronto, the purchase is

A) both a German and a Canadian import.

B) a German import and a Canadian export.

C) a German export and a Canadian import.

D) neither an export nor an import for either country.

10) Which of the following statements about the importance of trade to the U.S. economy is true?

A) Since 1950, both exports and imports have steadily decreased as a fraction of U.S. gross domestic product.

B) Overall, about 80 percent of U.S. manufacturing jobs depend directly or indirectly on exports.

C) The United States is the second largest exporter in the world.

D) The U.S. economy is highly dependent on international trade for growth in its gross domestic product.