Question 11 If accounting information has confirmatory value, it O has been verified by an external audit. O is prepared on an annual basis. O confirms or corrects prior expectations. O is neutral in its representations. Question 12 Which of the following is not a qualitative characteristic associated with faithful representation? o complete O comparability o neutrality Ofree from material error Question 13 An item is considered to be material if o the assets would be larger than the liabilities. the information would change an investor's mind. o the company has a loss. the company has never paid a dividend. Question 14 Notes to the financial statements are required because the most important objective of financial reporting is to provide information to the taxing authorities. obtain uniformity with foreign countries. provide information useful for decision-making. O provide information about the board of directors. Question 15 Which of the following is not an indication that control over goods or services have transferred at a point in time? o Customer has accepted the goods or service. Customer has legal title to the goods. Identifying the contract with a customer. Business has a right to payment. Question 16 Which of the following is a situation indicating that control over goods or services have transferred at a point in time? Customer accepts delivery and installation of an alarm system. Contractor constructing an office building. A warranty service that provides support for a period of two years. Customer purchases season tickets to the Wolves football team. Question 17 Financial statements are prepared for an economic business unit that is separate and distinct from its owners. This is referred to as the going concern assumption. O the objective of financial reporting. O a cost constraint. O the economic entity concept. Question 18 Linda is investing in a partnership with Lisa. Unda contributes equipment that originally cost $20000, has a carrying amount of $14500, and a fair value of $15700. The entry that the partnership makes to record Linda's initial contribution includes a credit to Accumulated Depreciation for $5500. debit to Equipment for $16700. debit to Equipment for $14500. debit to Equipment for $20000 Question 19 A determinable liability is one that O has uncertainty with the timing of the due date. O has uncertainty about the amount which is owed. O has a known payee. O has an amount which is due within one year. Question 20 The entry to record the proceeds upon issuing an interest-bearing note is: O Interest Expense Cash Notes Payable O Cash Notes Payable Notes Payable Cash Cash Notes Payable Interest Payable