1. Research in accounting would consider which of the following questions:

I. Should accountability or decision usefulness be the key goal of accounting.

II. What measurements are being used.

III. What impact do changes in specific accounting policies have on share prices.

IV. What measures should be used.

Select one:

A. II, III and IV.

B. II and IV.

C. I, II, III and IV.

D. I, II and IV.

2. Accounting theory can be described as:

Select one:

A. a set of facts, specific in nature, against which accounting practice can be evaluated.

B. being irrelevant to the development of new practice and procedures.

C. description, explanation or prediction of accounting practice based on observations and/or logical reasoning.

D. being based only on observations.

3. An example of how theory can predict accounting practice is:

Select one:

A. agency theory.

B. asset recognition theory.

C. capital market theory.

D. corporate social responsibility theory.