Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

For each of the following circumstances, give the letter Item(s) Indicating the accounting principle involved. Some letters may be used more than once, and some

image text in transcribed
image text in transcribed
For each of the following circumstances, give the letter Item(s) Indicating the accounting principle involved. Some letters may be used more than once, and some may not be used at all. A. Continuity I. Matching B. Neutrality 3. Proprietary c. Comparability K. Faithful representation D. Cost/benefit effectiveness L. Revenue recognition E. Full disclosure M. Separate entity F. Historical cost N. Time period G. Relevance 0. Unit of measure H. Nominal dollar financial capital maintenance 1. Financial statements are prepared from the point of view of the owners. A note describing the company's possible liability in a lawsuit is included with the financial 2. EG statements, even though no formal liability exists at the balance sheet date 3. Marketable securities are valued at current (market) value. O, HI The personal assets of partners are excluded from the partnership balance sheet even 4 KB though they are pledged as security for partnership loans A retail store uses estimates rather than a complete physical count of its inventory for 5. O, HI purposes of preparing monthly financial statements Allwilli married in the arrinte only when it arise from the ruhen another nntily K . 1. Financial statements are prepared from the point of view of the owners. 2 A note describing the company's possible liability in a lawsuit is included with the financial statements, even though no formal liability exists at the balance sheet date. E, G 3. Marketable securities are valued at current (market) value. O, HI The personal assets of partners are excluded from the partnership balance sheet, even 4. though they are pledged as security for partnership loans. K, A retail store uses estimates rather than a complete physical count of its inventory for 5. purposes of preparing monthly financial statements. O, HI 6. Goodwill is recorded in the accounts only when it arises from the purchase of another entity. F, K 7. An entity reports a $50 profit after buying a unit of inventory for $100 and selling it for $150, even though the cost to replace the unit has escalated to $112 due to inflation. 8. An advance deposit on a sales contract is reported as unearned revenue. 1.L Accounting policies chosen for revenue recognition are the same as those of the entity's 9. F,A, 1 major competitors. 10. Capital assets are depreciated over their useful lives. A

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

Different types of Grading?

Answered: 1 week ago

Question

Explain the functions of financial management.

Answered: 1 week ago

Question

HOW MANY TOTAL WORLD WAR?

Answered: 1 week ago

Question

Discuss the scope of financial management.

Answered: 1 week ago

Question

Which form of proof do you find least persuasive? Why?

Answered: 1 week ago