12. Which of the following best summarizes the going concern assumption? A. A company is reasonably expected to remain in business for the life of its founder. B. A company is reasonably expected to remain in business for the life of the majority of its shareholders. C. A company is reasonably expected to remain in business for the foreseeable future. D. A company is guaranteed to remain in business for the foreseeable future.

13. Which of the following would not be reported on an accrual-basis income statement? A. Utilities expense in the amount of a bill received for utilities used during the current period but unpaid as of the end of the period. B. Rent expense in the amount of rent paid during the period for use of a storage facility in the current period. C. Revenue in the amount of services provided to customers who promise to pay in the next period. D. Cost of land purchased for future use.

14. Which of the following statements about accrual-basis accounting is correct? A. If a company uses accrual basis accounting, the company should not record revenue until payment is actually received. B. If a company uses accrual basis accounting, the company should record expenses in the same period as the revenues they generate. C. United States GAAP does not allow accrual basis accounting for external reporting of income. D. The items reported on the income statement continue to have an impact beyond the current period, whereas the items reported on the balance sheet impact just the current period.