(b) Comparability. (c) Consistency. (d) Revenue generation. 3. What is the goal of the IASB? (a) To have worldwide acceptance of a set of international financial reporting standards. (b) To create a set of accounting rules that Europe and the United States will follow. (c) To create a set of accounting rules for countries other than the United States. (d) To work with the SEC to create a set of accounting rules for publicly held companies. 4. What are the basic financial statements provided in an annual report? (a) Balance sheet and income statement (b) Statement of financial earnings and statement of stockholders' equity. (c) Balance sheet, income statement, and statement of cash flows. (d) Balance sheet, income statement, statement of cash flows, and state- ment of stockholders' equity. 5. What items are included in the notes to the financial statements? (a) Summary of accounting policies. (b) Changes in accounting policies, if any. (c) Detail about particular accounts. (d) All of the above. 6. What does an unqualified auditor's report indicate? (a) The financial statements unfairly and inaccurately present the company's financial position for the accounting period. (b) The financial statements present fairly the financial position, the results of operations, and the changes in cash flows for the company. (C) There are certain factors that might impair the firm's ability to con tinue as a going concern. (d) Certain managers within the firm are unqualified and, as such, are not fairly or adequately representing the interests of the shareholders. _7. Which of the following statements is false? (a) The balance sheet or statement of financial position shows the finan cial position of the firm on a particular date, such as the end of a quarter or a year. (b) The income or earning statement presents the results of operations for the accounting periodontal (C) The statement of cash flows provides information related to the amount of accruals done during an accounting period. (d) The statement of stockholders' equity reconciles the beginning and ending balances of all accounts that appear in the stockholders' equity section of the balance sheet. 8. In terms of inventory valuation for the recognition of the cost of goods sold, which of the following methods is not acceptable? (a) Cost based on the selling price of the goods. (b) Lowest cost of goods sold first