Multiple choice

1. The standards and rules that are recognized as a general guide for financial reporting are called 

a. generally accepted accounting standards. 

b. generally accepted accounting principles. 

c. operating guidelines. 

d. standards of financial reporting. 

2. "Generally accepted" in the phrase generally accepted accounting principles means that the principles 

a. are proven theories of accounting. 

b. have substantial authoritative support. 

c. have been approved by the Internal Revenue Service. 

d. have been approved for use by the managements of business firms. 

3. The conceptual framework developed by the Financial Accounting Standards Board 

a. was approved by a vote of all accountants. 

b. are rules that all accountants must follow. 

c. is viewed as providing a constitution for setting accounting standards for financial reporting. d. is legally binding on all accountants. 

4. Accounting principles must be 

a. proven and tested. 

b. hypothesized and theorized. 

c. developed or decreed. 

d. universally accepted.