8) "Recognition is defined in the Conceptual Framework as A. The grouping, into broad classes, of the financial effects of transactions and other events according to economic characteristics. B. The process of determining the monetary amounts at which the elements of the financial statements are to be recognized and carried in the balance sheet and income statement. C. The removal of a previously recognized asset or liability from an entity's statement of financial position D. The process of incorporation in the balance sheet or income statement an item that meets the definition of an elements and satisfies the criteria for recognition 9) Which statements is false concerning users and their information needs? A Lenders are interest in information that enables them to determine whether their loans and the interest on these loans will be paid when due. B. The providers of risk capital and their advisers are concerned with the risk of inherent in return provided by their investment, C. Government and its agencies have an interest in information about the continuance of an enterprise especially when they have long-term involvement or are dependent on the enterprise D. Employees and their representative groups are interest in information about the stability and profitability of the entity 10) Which of the following statement(s) regarding the conceptual framework is (are) incorrect? A. The framework applies to financial statements of business reporting enterprises both in the private sector and in the public sector. B. In cases where there is conflict between the framework and PFRS, the requirement of the framework wil prevail. Both A and B D. Neither Anor B 11) Which is not a specific purpose of the conceptual framework? A. To assist preparers of financial statement in applying the accounting standards. B. To assist FRSC in the development of future Philippine Financial Reporting Standards (PFRSs) and in its review of existing PFRSs. To assist users of financial statements in interpreting the information contained in financial statements. D. To assist the Board of Accountancy in promulgating rules and regulations affecting the practice of accountancy in the Philippines 12) What is the basic purpose of accounting? A. To provide quantitative financial information about economic activities. B. To provide all information that users need in making economic decisions. To provide qualitative financial information about economic activities intended to be useful in making economic decisions. D. To provide quantitative financial information about economic activities intended to be useful in making economic decisions 13) To meet the probability criterion, in relation to recognition of assets and liabilities, the expectation that future economic benefits will flow to or from an entity must be Certain B. Virtually certain Sufficiently certain D. Not certain A
