Question : 137. Which statement below best describes the objectives of financial : 1255702

 

 

137. Which statement below best describes the objectives of financial accounting?

a. Provide information that helps predict cash flows.

b. Provide information about the economic resources, claims to resources and changes in resources and claims.

c. Provide information that is useful in making decisions.

d. All of the other answers are correct.

 

 

138. The assumption that a business will continue to operate into the future is the:

a. Monetary unit assumption.

b. Periodicity assumption.

c. Economic entity assumption.

d. Going concern assumption.

 

 

139. The qualitative characteristic that says accounting information can influence users’ decisions by allowing them to assess past performance is:

a. Timeliness.

b. Neutrality.

c. Confirmatory value.

d. Predictive value.

 

 

140. The major underlying assumptions of accounting include all of the following except:

a. Economic entity.

b. Monetary unit.

c. Legal liability.

d. Going concern.

 

 

141. The assumption that the assets and liabilities of the business are accounted for on the books of the company but not included in the records of the owner is the:

a. Monetary unit assumption.

b. Economic entity assumption.

c. Going concern assumption.

d. Periodicity assumption.

 

 

142. Accounting information that does not provide measurement bias in favor of a particular set of companies has the characteristic of:

a. Relevance.

b. Consistency.

c. Materiality.

d. Neutrality.

 

 

143. If accounting information is considered to have faithful representation, then which of the following is true?

a. The information represents to users what it claims to represent.

b. The information follows conservatism principles and is also material.

c. The information is considered pertinent to or affects decisions.

d. The information will have predictive value, feedback value, and is timely.

 

 

144. For accounting information to be relevant, it should possess which of the following characteristics?

a. Predictive value, confirmatory value, and/or materiality.

b. Large in amount and timely.

c. Comparability or consistency.

d. Verifiability.

 

 

145. Materiality is based upon which factor(s)?

a. Timeliness of an item.

b. Amount and nature of an item.

c. Consistency of an item.

d. Relevance of an item.

 

 

146. If a company has gone bankrupt, its financial statements likely violate the:

a. Periodicity assumption.

b. Monetary unit assumption.

c. Going concern assumption.

d. Economic entity assumption.

 

 

 

147. The conceptual framework’s qualitative characteristic of relevance includes:

a. Predictive value.

b. Verifiability.

c. Completeness.

d. Neutrality.

 

 

148. The conceptual framework’s qualitative characteristic of faithful representation includes:

a. Predictive value.

b. Neutrality.

c. Confirmatory value.

d. Comparability.

 

 

149. Constraints on qualitative characteristics of accounting information include:

a. Freedom from material error.

b. Going concern.

c. Neutrality.

d. Cost effectiveness.

 

 

150. Fundamental qualitative characteristics of accounting information are:

a. Relevance and comparability.

b. Comparability and consistency.

c. Faithful representation and relevance.

d. Faithful representation and consistency.

 

 

151. Enhancing qualitative characteristics of accounting information include:

a. Relevance and comparability.

b. Comparability and consistency.

c. Faithful representation and relevance.

d. Cost effectiveness and materiality.