Question 1.1. The most recent example of the political process at work in standard-setting is the heated debate that occurred on the issue of: (Points : 3)

Pension plan accounting. Accounting for postretirement benefits other than pensions. Accounting for business combinations. Accounting for stock-based compensation.

Question 2.2. According to the conceptual framework, verifiability implies: (Points : 3)

Legal evidence. Logic. Consensus. Legal verdict.

Question 3.3. The primary professional organization for those accountants working in the industry is the: (Points : 3)

AAA. AICPA. IIA. IMA.

Question 4.4. Accounting standard-setting has been characterized as: (Points : 3)

A political process. Using the scientific method. Pure deductive reasoning. Pure inductive reasoning.

Question 5.5. A constraint on qualitative characteristics of accounting information is: (Points : 3)

Timeliness. Going concern. Neutrality. Cost-effectiveness.

Question 6.6. The most political issue in the FASB's most recent deliberations and amendments to GAAP on business combinations was: (Points : 3)

The negative effects on subsequent earnings of amortizing goodwill if firms were required to use the purchase method of accounting for the combination. The negative effects on subsequent earnings of amortizing goodwill if firms were required to use the pooling method of accounting for the combination. The unrealistic balance sheet assets that would be created if firms were required to use the purchase method of accounting for the combination. The unrealistic balance sheet assets that would be created if firms were required to use the pooling method of accounting for the combination.

Question 7.7. Which of the following Statements of Financial Accounting Concepts defines the 10 elements of financial statements? (Points : 3)

SFAC 4. SFAC 3. SFAC 5. SFAC 6.

Question 8.8. An important argument in support of historical cost information is: (Points : 3)

Relevance. Predictive quality for future cash flows. Materiality. Verifiability.

Question 9.9. Net income equals: (Points : 3)

Assets minus liabilities. Revenues minus cost of goods sold. Revenues minus expenses. Cash receipts minus cash payments.

Question 10.10. The primary historical reason for the FASB reversing its positions when political pressures occur is: (Points : 3)

The cost of gathering data was prohibitive. The difficulties in measurement were too great. They have no authority in such situations. The SEC did not support the FASB position.

Question 11.11. Land was acquired in 2016 for a future building site at a cost of $40,000. The assessed valuation for tax purposes is $27,000, a qualified appraiser placed its value at $48,000, and a recent firm offer for the land was for a cash payment of $46,000. The land should be reported in the financial statements at: (Points : 3)

$40,000. $27,000. $46,000. $48,000.

Question 12.12. The primary focus for financial accounting information is to provide information useful for:

	Investing decisions	Credit decisions
a.	Yes	Yes
b.	Yes	No
c.	No	Yes
d.	No	No

(Points : 3)

Option a Option b Option c Option d

Question 13.13. The International Accounting Standards Board: (Points : 3)

Was the predecessor to the IASC. Can overrule the FASB when their policies disagree. Promotes the use of high-quality, understandable global accounting standards. Has its headquarters in Geneva.

Question 14.14. The primary objective of financial accounting information is to provide useful information to: (Points : 3)

Management. Capital providers. Regulators. Academicians.