Listed below are several information characteristics and accounting principles and assumptions

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

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

The qualitative characteristics that make accounting information useful for decision-making purposes are as follows

E2-2 (Qualitative Characteristics) The qualitative characteristics that make accounting information useful for decision-making purposes are as follows.

Relevance Timeliness Representational faithfulness
Reliability Verifiability Comparability
Predictive value Neutrality Consistency
Feedback value

Instructions
Identify the appropriate qualitative characteristic(s) to be used given the information provided below.
(a) Qualitative characteristic being employed when companies in the same industry are using the same accounting principles.
(b) Quality of information that confirms users' earlier expectations.
(c) Imperative for providing comparisons of a company from period to period.
(d) Ignores the economic consequences of a standard or rule.
(e) Requires a high degree of consensus among individuals on a given measurement.
(f) Predictive value is an ingredient of this primary quality of information.
(g) Two qualitative characteristics that are related to both relevance and reliability.
(h) Neutrality is an ingredient of this primary quality of accounting information.
(i) Two primary qualities that make accounting information useful for decision-making purposes.
(j) Issuance of interim reports is an example of what primary ingredient of relevance?

Click here for the solution: The qualitative characteristics that make accounting information useful for decision-making purposes are as follows