FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
8th Edition
ISBN: 9781119250913
Author: Kimmel
Publisher: WILEY
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Textbook Question
Chapter 2, Problem 2.3DIE
The following characteristics, assumptions, principles, and constraint guide the FASB when it creates accounting standards.
| Relevance | Periodicity assumption |
| Faithful representation | Going concern assumption |
| Comparability | Historical cost principle |
| Consistency | Full disclosure principle |
| Monetary unit assumption | Materiality |
| Economic entity assumption | Cost constraint |
Match each item above with a description below.
- 1. Items not easily quantified in dollar terms are not reported in the financial statements.
- 2. Accounting information must be complete, neutral, and free from error.
- 3. Personal transactions are not mixed with the company’s transactions.
- 4. The cost to provide information should be weighed against the benefit that users will gain from haring the information available.
- 5. A company’s use of the same accounting principles from year to year.
- 6. Assets are recorded and reported at original purchase price.
- 7. Accounting information should help users predict future events, and should confirm or correct prior expectations.
- 8. The life of a business can be divided into artificial segments of time.
- 9. The reporting of all information that would make a difference to financial statement users.
- 10. The judgment concerning whether an item’s size makes it likely to influence a decision-maker.
- 11. Assumes a business will remain in operation for the foreseeable future.
- 12. Different companies use the same accounting principles.
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Which concept states that any policies adopted for accounting should not change frequently unless it is the demand of the changing circumstances
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Financial accounting information is characterized by all ofthe following except:a. It is historical in nature.b. It sometimes results from inexact and approximatemeasures.c. It is factual, so it does not require judgment to prepare.d. It is enhanced by management’s explanation.
Discuss the four basic Assumptions that underline the financial Accounting Structures with example.
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I. Relevance VI. Comparability
II.Faithful representation VII.Completeness
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Chapter 2 Solutions
FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
Ch. 2 - What is meant by the term operating cycle?Ch. 2 - Define current assets. What basis is used for...Ch. 2 - Prob. 3QCh. 2 - Prob. 4QCh. 2 - Prob. 5QCh. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - Prob. 8QCh. 2 - What do these classes of ratios measure? (a)...Ch. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Prob. 12QCh. 2 - (a) What is the primary objective of financial...Ch. 2 - Merle Hawkins, the president of Pathway Company,...Ch. 2 - Prob. 15QCh. 2 - Prob. 16QCh. 2 - Prob. 17QCh. 2 - Prob. 18QCh. 2 - What is the economic entity assumption? Give an...Ch. 2 - Prob. 20QCh. 2 - The following are the major balance sheet...Ch. 2 - Prob. 2.2BECh. 2 - Prob. 2.3BECh. 2 - Prob. 2.4BECh. 2 - Prob. 2.5BECh. 2 - Prob. 2.6BECh. 2 - Prob. 2.7BECh. 2 - Prob. 2.8BECh. 2 - Here are some qualitative characteristics of...Ch. 2 - Prob. 2.10BECh. 2 - Prob. 2.1ADIECh. 2 - Prob. 2.1BDIECh. 2 - Prob. 2.2DIECh. 2 - The following characteristics, assumptions,...Ch. 2 - Prob. 2.1ECh. 2 - The major balance sheet classifications are listed...Ch. 2 - Prob. 2.3ECh. 2 - Prob. 2.4ECh. 2 - Prob. 2.5ECh. 2 - Prob. 2.6ECh. 2 - Prob. 2.7ECh. 2 - Prob. 2.8ECh. 2 - Nordstrom, Inc. operates department stores in...Ch. 2 - Prob. 2.10ECh. 2 - Prob. 2.11ECh. 2 - Prob. 2.12ECh. 2 - Prob. 2.13ECh. 2 - Prob. 2.1APCh. 2 - Prob. 2.2APCh. 2 - Prob. 2.3APCh. 2 - Prob. 2.4APCh. 2 - Prob. 2.5APCh. 2 - Prob. 2.6APCh. 2 - Prob. 2.7APCh. 2 - Prob. 2.8APCh. 2 - Prob. 2.1EYCTCh. 2 - Prob. 2.2EYCTCh. 2 - Prob. 2.3EYCTCh. 2 - Prob. 2.4EYCTCh. 2 - Prob. 2.7EYCTCh. 2 - Prob. 2.8EYCTCh. 2 - Prob. 2.9EYCTCh. 2 - ETHICS CASE At one time, Boeing closed a giant...Ch. 2 - In what ways does the format of a statement of...Ch. 2 - Prob. 2.2IFRSCh. 2 - Prob. 2.3IFRSCh. 2 - Prob. 2.4IFRSCh. 2 - Prob. 2.5IFRS
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