Day 1

Question 1

Financial accounting concept that refers to the characteristics of accounting information that provides predictive value to the user as a quality of:

Answer 1

Relevance - contemplates predictive value, confirming value, and materiality

MCQ-05060

Question 2

FASB - Financial Qualitative Characteristics

Answer 2

What is relevant to you? Passing Confirms Money

1. Relevance
   - Predictive Value
   - Confirm Value
   - Materiality

Completely Neutral is Free from errors

2. Faithful Representation
   - Complete
   - Neutral
   - Free From Error

MCQ-14607

Question 3

FASB - Enhancing Qualitative Characteristics

Answer 3

Compare and Verify in Time to Understand

1. Comparability
2. Verifiability
3. Timelines
4. Understandability

MCQ-00105

Question 4

What is a qualitative characteristic that enhances the usefulness of financial info?

Answer 4

Verifiability

MCQ-15856

Question 5

Interim FS can be described as emphasizing what Enhancing Qualitative Characteristics?

Answer 5

Timeliness - by providing financial info based on actual performance to date and estimates prior to year end

Interim FS use of estimates means they are less verifiable - Timeliness is best for Interim FS

MCQ-00105

Question 6

What is included in the Single Step Income Stmt

Answer 6

Total revenues all sales of goods, services, and rentals

Purchase Discounts are not included in revenue, they reduce COGS

Recovery of accounts written off does not hit the revenue account

MCQ-06565

Question 7

ABC Inc sold a bldg and used the proceeds to buy a new bldg. The excess of the proceeds over the carrying amount of the bldg should be reported as?

Answer 7

Rule: when FA is sold, gain or loss is recognized as part of income from continuing operations

MCQ-00209

Question 8

Equation: Gross Profit

Answer 8

= Sales - COGS

MCQ-07216

Question 9

Is Interest and Advertising expenses included in General and Administrative expenses?

Answer 9

No

Interest - separately stated

Advertising - Selling Expense

MCQ-00052

Question 10

ABC Inc, installed cabinets to display merchandise in customers stores, ABC expects to use these cabinets for 5 years. ABC’s year 1 multi step income Stmt should include:

Answer 10

1/5 of the cabinets cost (depreciation expense) should be included in SG&A expenses

MCQ-00200

Question 11

What costs should be reported as General and Administrative expenses?

Answer 11

• Accounting
• Officer’s Salaries
• Insurance

MCQ-00204