Question
Identify the basic assumption, broad accounting principle, pervasive constraint or the desired fundamental and enhancing qualitative characteristics of accounting information in the conceptual framework that
Identify the basic assumption, broad accounting principle, pervasive constraint or the desired fundamental and enhancing qualitative characteristics of accounting information in the conceptual framework that best applies to each statement (give only the one answer that best applies to the statement).
a. Liquidation values are not normally reported in financial statements even though many companies do go out of business.
b. The Parker Corporation does not adjust the valuation of assets and liabilities to reflect changes in the purchasing power of the dollar.
c. In a typical reporting period, a manufacturing company records revenue from selling a product and also records the cost of goods sold on the sale.
d. Banks use fair value for purposes of valuing financial instruments.
e. Qualitative characteristic being employed when companies in the same industry are using the same accounting principles.
f. An item is not recorded because its effect on income would not change a decision.
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