1. (TCO A) Listed below are several information characteristics and accounting principles and assumptions. Match the letter of each with the appropriate phrase that states its application. (Points: 30)
1: Stable dollar assumption
2: Notes as part of necessary information to a fair presentation.
3: Earnings process completed and realized or realizable.
4: Valuing assets at amounts originally paid for them.
5: the impact of an item on the overall financial operations of a company.
6: Accruals and deferrals in adjusting and closing process (Do not use going concern).
7: Affairs of the business distinguished from those of its owners.
8: Presentation of error-free information with representational faithfulness
9: Business enterprise assumed to have a long life.
10: Cost of providing financial information versus the benefits derived from its use.
: Historical cost principle
: Going concern principle
: Matching principle
: Monetary unit
: Revenue recognition principle
: Full disclosure principle
: Reliability characteristic
: Cost-benefit relationship
: Materiality constraint
: Economic entity assumption
Click here for the solution: Listed below are several information characteristics and accounting principles and assumptions
Showing posts with label Principles. Show all posts
Showing posts with label Principles. Show all posts
Thursday, November 26, 2015
Monday, October 26, 2015
The following situations involve accounting principles and assumptions
ACC 557 Week 1 Assignment
E1-4 The following situations involve accounting principles and assumptions.
1. Grossman Company owns buildings that are worth substantially more than they originally cost. In an effort to provide more relevant information, Grossman reports the buildings at market value in its accounting reports.
2. Jones Company includes in its accounting records only transaction data that can be expressed in terms of money.
3. Caleb Borke, president of Caleb’s Cantina, records his personal living costs as expenses of the Cantina.
Instructions
For each of the three situations, say if the accounting method used is correct or incorrect. If correct, identify which principle or assumption supports the method used. If incorrect, identify which principle or assumption has been violated.
Click here for the solution: The following situations involve accounting principles and assumptions
E1-4 The following situations involve accounting principles and assumptions.
1. Grossman Company owns buildings that are worth substantially more than they originally cost. In an effort to provide more relevant information, Grossman reports the buildings at market value in its accounting reports.
2. Jones Company includes in its accounting records only transaction data that can be expressed in terms of money.
3. Caleb Borke, president of Caleb’s Cantina, records his personal living costs as expenses of the Cantina.
Instructions
For each of the three situations, say if the accounting method used is correct or incorrect. If correct, identify which principle or assumption supports the method used. If incorrect, identify which principle or assumption has been violated.
Click here for the solution: The following situations involve accounting principles and assumptions
Wednesday, September 23, 2015
What are the major authorization principles the auditor should investigate
What are the major authorization principles the auditor should
investigate regarding both cash management and investments in marketable
securities?
Click here for the solution: What are the major authorization principles the auditor should investigate
Click here for the solution: What are the major authorization principles the auditor should investigate
Sunday, September 20, 2015
Listed below are some information characteristics and accounting principles and assumptions
Listed below are some information characteristics and accounting
principles and assumptions. Match the letter of each with the
appropriate phrase that states its application
Answer Potential Matches
_______________ Consistency characteristic 1. Presentation of error-free information with representational faithfulness.
_______________ Historical cost principle 2. Money in the common denominator of economic activity and provides an appropriate basis for accounting measurement and analysis.
_______________ Going concern principle 3. Business enterprise assumed to have a long life
_______________ Periodicity assumption 4. Application of the same accounting principles as in the preceding year
_______________ Reliability characteristic 5. Valuing assets at amounts originally paid for them
_______________ Economic entity assumption 6. Implies that a company can divide its economic activities into artificial time periods.
_______________ Monetary unit assumption 7. Notes as part of necessary information to a fair presentation
_______________ Revenue recognition principle 8. Affairs of the business distinguished from those of its owners
_______________ Full disclosure principle 9. Economic activity can be identified with a particular unit of accountability
________________ Economic entity assumption 10. Earnings process completed and realized or realizable
Click here for the solution: Listed below are some information characteristics and accounting principles and assumptions
Answer Potential Matches
_______________ Consistency characteristic 1. Presentation of error-free information with representational faithfulness.
_______________ Historical cost principle 2. Money in the common denominator of economic activity and provides an appropriate basis for accounting measurement and analysis.
_______________ Going concern principle 3. Business enterprise assumed to have a long life
_______________ Periodicity assumption 4. Application of the same accounting principles as in the preceding year
_______________ Reliability characteristic 5. Valuing assets at amounts originally paid for them
_______________ Economic entity assumption 6. Implies that a company can divide its economic activities into artificial time periods.
_______________ Monetary unit assumption 7. Notes as part of necessary information to a fair presentation
_______________ Revenue recognition principle 8. Affairs of the business distinguished from those of its owners
_______________ Full disclosure principle 9. Economic activity can be identified with a particular unit of accountability
________________ Economic entity assumption 10. Earnings process completed and realized or realizable
Click here for the solution: Listed below are some information characteristics and accounting principles and assumptions
Presented below is the assumptions, principles, and constraints discussed in this chapter
E7-3 Presented below is the assumptions, principles, and constraints discussed in this chapter.
1. Economic entity assumption 6. Matching principle
2. Going concern assumption 7. Full disclosure principle
3. Monetary unit assumption 8. Revenue recognition principle
4. Time period assumption 9. Materiality
5. Cost principle 10. Conservatism
Instructions: Identify by number the accounting assumption, principle, or constraint above that describes each situation below. Do not use a number more than once.
(a) Is the rationale for why plant assets are not reported at liquidation value. (Do not use historical cost principle.)
(b) Indicates that personal and business record-keeping should be separately maintained.
(c) Ensures that all relevant financial information is reported.
(d) Assumes that the dollar is the “measuring stick” used to report on financial performance.
(e) Requires that the operational guidelines be followed for all significant items.
(f) Separates financial information into time periods for reporting purpose.
(g) Requires recognition of expenses in the same period as related revenues.
(h) Indicates that market value changes subsequent to purchase are not recorded in the accounts.
Click here for the solution: Presented below is the assumptions, principles, and constraints discussed in this chapter
1. Economic entity assumption 6. Matching principle
2. Going concern assumption 7. Full disclosure principle
3. Monetary unit assumption 8. Revenue recognition principle
4. Time period assumption 9. Materiality
5. Cost principle 10. Conservatism
Instructions: Identify by number the accounting assumption, principle, or constraint above that describes each situation below. Do not use a number more than once.
(a) Is the rationale for why plant assets are not reported at liquidation value. (Do not use historical cost principle.)
(b) Indicates that personal and business record-keeping should be separately maintained.
(c) Ensures that all relevant financial information is reported.
(d) Assumes that the dollar is the “measuring stick” used to report on financial performance.
(e) Requires that the operational guidelines be followed for all significant items.
(f) Separates financial information into time periods for reporting purpose.
(g) Requires recognition of expenses in the same period as related revenues.
(h) Indicates that market value changes subsequent to purchase are not recorded in the accounts.
Click here for the solution: Presented below is the assumptions, principles, and constraints discussed in this chapter
Friday, September 18, 2015
Comprehensive Problem: Chapter 12 to 16, pg 724-725, from Weygandt, Accounting Principles, 9e (9th Edition)
Comprehensive Problem: Chapter 12 to 16, pg 724-725, from Weygandt, Accounting Principles, 9e (9th Edition)
AND SO ON
All Parts 1 to 5
Click here for the solution: Comprehensive Problem: Chapter 12 to 16, pg 724-725, from Weygandt, Accounting Principles, 9e (9th Edition)
Friday, August 21, 2015
CA19-1 (Objectives and Principles for Accounting for Income Taxes)
CA19-1 (Objectives and Principles for Accounting for Income Taxes) The amount of income taxes due to the government for a period of time is rarely the amount reported on the income statement for that period as income tax expense.
Instructions
(a) Explain the objectives of accounting for income taxes in general purpose financial statements.
(b) Explain the basic principles that are applied in accounting for income taxes at the date of the financial statements to meet the objectives discussed in (a).
(c) List the steps in the annual computation of deferred tax liabilities and assets.
Click here for the solution: CA19-1 (Objectives and Principles for Accounting for Income Taxes)
Instructions
(a) Explain the objectives of accounting for income taxes in general purpose financial statements.
(b) Explain the basic principles that are applied in accounting for income taxes at the date of the financial statements to meet the objectives discussed in (a).
(c) List the steps in the annual computation of deferred tax liabilities and assets.
Click here for the solution: CA19-1 (Objectives and Principles for Accounting for Income Taxes)
Saturday, August 1, 2015
Presented below are the assumptions, principles, and constraints used in this chapter
E2-4 (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter.
1. Economic entity assumption
2. Going concern assumption
3. Monetary unit assumption
4. Periodicity assumption
5. Historical cost principle
6. Fair value principle
7. Expense recognition principle
8. Full disclosure principle
9. Cost-benefit relationship
10. Materiality
11. Industry practices
12. Conservatism
Instructions
Identify by number the accounting assumption, principle, or constraint that describes each situation on the next page. Do not use a number more than once.
(a) Allocates expenses to revenues in the proper period.
(b) Indicates that fair value changes subsequent to purchase are not recorded in the accounts. (Do not use revenue recognition principle.)
(c) Ensures that all relevant financial information is reported.
(d) Rationale why plant assets are not reported at liquidation value. (Do not use historical cost principle.)
(e) Anticipates all losses, but reports no gains.
(f) Indicates that personal and business record keeping should be separately maintained.
(g) Separates financial information into time periods for reporting purposes.
(h) Permits the use of fair value valuation in certain industries. (Do not use fair value principle.)
(i) Requires that information significant enough to affect the decision of reasonably informed users should be disclosed. (Do not use full disclosure principle.)
(j) Assumes that the dollar is the "measuring stick" used to report on financial performance.
Click here for the solution: Presented below are the assumptions, principles, and constraints used in this chapter
1. Economic entity assumption
2. Going concern assumption
3. Monetary unit assumption
4. Periodicity assumption
5. Historical cost principle
6. Fair value principle
7. Expense recognition principle
8. Full disclosure principle
9. Cost-benefit relationship
10. Materiality
11. Industry practices
12. Conservatism
Instructions
Identify by number the accounting assumption, principle, or constraint that describes each situation on the next page. Do not use a number more than once.
(a) Allocates expenses to revenues in the proper period.
(b) Indicates that fair value changes subsequent to purchase are not recorded in the accounts. (Do not use revenue recognition principle.)
(c) Ensures that all relevant financial information is reported.
(d) Rationale why plant assets are not reported at liquidation value. (Do not use historical cost principle.)
(e) Anticipates all losses, but reports no gains.
(f) Indicates that personal and business record keeping should be separately maintained.
(g) Separates financial information into time periods for reporting purposes.
(h) Permits the use of fair value valuation in certain industries. (Do not use fair value principle.)
(i) Requires that information significant enough to affect the decision of reasonably informed users should be disclosed. (Do not use full disclosure principle.)
(j) Assumes that the dollar is the "measuring stick" used to report on financial performance.
Click here for the solution: Presented below are the assumptions, principles, and constraints used in this chapter
Monday, May 11, 2015
Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter
ACC 421 Week Two (Week 2)
Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter.
1. Economic entity assumption 5. Historical cost principle 9. Materiality
2. Going concern assumption 6. Matching principle 10. Industry practices
3. Monetary unit assumption 7. Full disclosure principle 11. Conservatism
4. Periodicity assumption 8. Cost-benefit relationship
Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter.
1. Economic entity assumption 5. Historical cost principle 9. Materiality
2. Going concern assumption 6. Matching principle 10. Industry practices
3. Monetary unit assumption 7. Full disclosure principle 11. Conservatism
4. Periodicity assumption 8. Cost-benefit relationship
Instructions
Identify by number the accounting assumption, principle, or constraint that describes each situation below. Do not use a letter more than once.
(a) Allocates expenses to revenues in the proper period.
(b) Indicates that market value changes subsequent to purchase are not recorded in the accounts. (Do not use revenue recognition principle.)
(c) Ensures that all relevant financial information is reported.
(d) Rationale why plant assets are not reported at liquidation value. (Do not use historical cost principle.)
(e) Anticipates all losses, but reports no gains.
(f) Indicates that personal and business record keeping should be separately maintained.
(g) Separates financial information into time periods for reporting purposes.
(h) Permits the use of market value valuation in certain specific situations.
(i) Requires that information significant enough to affect the decision of reasonably informed users should be disclosed. (Do not use full disclosure principle.)
(j) Assumes that the dollar is the “measuring stick” used to report on financial performance.
Click here for the solution: Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter
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