MULTIPLE CHOICE
67.All of the following are components of the objective of financial reporting identified by the FASB, except
a.
to provide cash flow information.
b.
to furnish profit projections.
c.
to furnish information on asset stewardship.
d.
to provide asset, liability, and stockholders’ equity information.
68.All of the following must certify that a company’s financial statements are accurate, complete, and not misleading, except
a.
its auditor.
b.
its chief financial officer.
c.
its chief executive officer.
d.
the FASB.
69.According to the FASB, the usefulness of accounting information is judged by which of the following two major characteristics of accounting information?
a.
Verifiability and timeliness
b.
Comparability and neutrality
c.
Relevance and faithful representation
d.
Faithful representation and comparability
70.The qualitative characteristic of relevance contains all the following features, except
a.
direct bearing on a decision.
b.
predictive value.
c.
confirmative value.
d.
verifiability.
71.The qualitative characteristic of faithful representation contains all the following features, except
a.
neutrality.
b.
free from material error.
c.
predictive value.
d.
completeness.
72.Accounting information should make a difference to the outcome of a decision, according to the qualitative characteristic of
a.
relevance.
b.
neutrality.
c.
faithful representation.
d.
verifiability.
73.The user can depend on the accuracy of financial information when which of the following qualitative characteristics has been followed?
a.
Predictive value
b.
Timeliness
c.
Faithful representation
d.
Relevance
74.The Securities and Exchange Commission instituted rules requiring the chief executive officers and chief financial officers of all publicly traded companies to certify that, to their knowledge, the quarterly and annual statements that their companies file with the SEC are
a.
accurate and complete.
b.
not to be used except by individuals working for the company.
c.
100 percent accurate and contain no misstatements, errors, or mistakes.
d.
subject to interpretation due to the many accounting rules and regulations.
75.The lower-of-cost-or-market method of accounting for inventories follows the convention of
a.
full disclosure.
b.
conservatism.
c.
cost-benefit.
d.
materiality.
76.The convention of consistency refers to consistent use of accounting principles
a.
among accounting periods.
b.
throughout the accounting period.
c.
within industries.
d.
among firms.
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