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Quiz201-WOA1.docx
MULTIPLE CHOICE
1. Charging off equipment that cost less than $20 would be an example of the application of:
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a. |
going concern. |
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b. |
cost. |
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c. |
matching. |
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d. |
materiality. |
|
e. |
realization. |
2. Valuing assets at their liquidation values is not consistent with:
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a. |
conservatism. |
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b. |
materiality. |
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c. |
going concern. |
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d. |
time period. |
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e. |
None of the answers are correct. |
3. Valuing inventory at the lower of cost or market is an application of the:
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a. |
time period assumption. |
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b. |
realization principle. |
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c. |
going concern principle. |
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d. |
conservatism principle. |
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e. |
None of the answers are correct. |
4. The realization principle leads accountants to usually recognize revenue at:
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a. |
the end of production. |
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b. |
during production. |
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c. |
the receipt of cash. |
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d. |
the point of sale. |
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e. |
None of the answers are correct. |
5. All but one of the following statements indicates a difference between the Financial Accounting Standards Board (FASB) and prior approaches. Select the one that is not a difference.
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a. |
The FASB is independent of the AICPA. |
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b. |
The size of the board is much smaller. |
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c. |
The FASB has broader representation. |
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d. |
The FASB is the primary board for the development of generally accepted accounting principles. |
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e. |
Members of the FASB serve on a full-time basis. |
6. By law, the setting of accounting standards is the responsibility of the:
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a. |
AICPA Committee on Accounting Procedure. |
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b. |
New York Stock Exchange. |
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c. |
Accounting Principles Board. |
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d. |
Securities and Exchange Commission. |
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e. |
Financial Accounting Standards Board. |
7. The assumption that allows accountants to accept some inaccuracy, because of incomplete information about the future, in exchange for more timely reporting is:
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a. |
conservatism. |
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b. |
time period. |
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c. |
business entity. |
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d. |
materiality. |
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e. |
realization. |
8. Accountants provide for inflation using which of the following accounting principles?
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a. |
Going concern |
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b. |
Time period |
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c. |
Conservatism |
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d. |
Materiality |
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e. |
None of the answers are correct. |
9. The following data relate to Falcon Company for the year ended December 31, 2012. Falcon Company uses the cash basis.
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Sales for cash |
$180,000 |
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Sales for credit |
190,000 |
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Cost of inventory sold |
210,000 |
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Collections from customers |
350,000 |
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Purchases of inventory on credit |
200,000 |
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Payment for purchases |
220,000 |
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Selling expenses (accrual basis) |
60,000 |
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Payment for selling expenses |
70,000 |
Which of the following amounts represents income for Falcon Company for the year ended December 31, 2012?
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a. |
$90,000 |
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b. |
$80,000 |
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c. |
$70,000 |
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d. |
$60,000 |
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e. |
None of the answers are correct. |
10. Other than December, the most popular month for fiscal year-end is:
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a. |
January. |
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b. |
March. |
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c. |
June. |
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d. |
September. |
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e. |
October. |
