Question : 78.The basic purpose of generally accepted accounting principles to: A. Minimize the : 1259405

78.The basic purpose of generally accepted accounting principles is to:

A. Minimize the possibility of a business becoming insolvent.

B. Provide a framework for financial reporting that is understood by both the preparers and the users of financial statements.

C. Ensure that financial statements include the type of information that is best suited to every type of business decision.

D. Eliminate the need for professional judgment in preparing financial statements.

79.Establishing international accounting standards is the responsibility of:

A. AICPA.

B. IASB.

C. SEC.

D. AAA.

80.Generally accepted accounting principles are intended to assist accountants in preparing financial statements that:

A. Are relevant, verifiable, comparable, and understandable.

B. Show the business to be both solvent and profitable.

C. Comply with all income tax rules and regulations.

D. Are ideally suited to the specific needs of each user of the financial statements.

81.Which of the following is not an objective of generally accepted accounting principles?

A. To minimize the amount of income taxes owed.

B. To ensure that both preparers and users of financial statements understand the concepts and assumptions used in presenting information within these statements.

C. To enhance the relevance and verifiability of information contained in financial statements.

D. To increase the comparability of financial statements prepared by different companies.

82.In the phrase “generally accepted accounting principles,” the words accounting principles refers to:

A. The standards, assumptions, and concepts that serve as “ground rules” for financial reporting.

B. Ethical standards that prohibit fraudulent or misleading financial reporting.

C. The steps in the accounting cycle.

D. The accounting practices authorized by the Financial Accounting Standards Board (FASB).

83.The accounting standards and concepts used in the preparation of financial statements are called:

A. Certified principles of accounting (CPA).

B. Generally accepted accounting principles (GAAP).

C. Federal accounting standards and bylaws (FASB).

D. Standards enforcing consistency (SEC).

84.Generally accepted accounting principles are the “ground rules” used in the preparation of:

A. Income tax returns.

B. All accounting reports.

C. Reports to federal and state regulatory agencies.

D. Financial statements.

85.The Financial Accounting Standards Board is:

A. Responsible for the review and audit of federal income tax returns.

B. Primarily concerned with the preparation of the annual federal budget.

C. A private group that conducts research and determines generally accepted accounting principles.

D. A government agency with legal authority to approve or disapprove the financial statements of corporations that sell their securities to the public.

86.The Accounting Standards Codification was developed by:

A. The Financial Accounting Standards Board.

B. Certified public accountants.

C. The Securities and Exchange Commission.

D. The Internal Revenue Service.

87.The body created by the Sarbanes Oxley Act and charged with oversight of the accounting profession is the:

A. Public Company Accounting Oversight Board.

B. Auditing Standards Board.

C. International Accounting Standards Board.

D. Securities and Exchange Commission.

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July 1, 2023

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