XFARE - Accounting Concepts

Question 0

Which financial statement best Portrays liquidity and solvency?

Answer 0

Balance sheet

Question 1

What is the pervasive constraint of providing accounting information?

Answer 1

Cost/benefit rule

Question 2

What are the three characteristics of relevant financial information?

Answer 2

1. Timeliness
2. Predictive value
3. Feedback value

Question 3

What are the three characteristics of reliable financial information?

Answer 3

1. Verifiability
2. Representational faithfulness
3. Neutrality

Question 4

What transactions affect cash today and net income later?

Answer 4

Deferrals

Question 5

What is the threshold for accounting recognition?

Answer 5

Materiality

Question 6

What is the accounting principle behind portraying loss but not game contingencies?

Answer 6

Conservatism

Question 7

What accounting process requires revenues to be shown in the same time period With related expenses?

Answer 7

Matching

Question 8

What is the overall goal of financial reporting?

Answer 8

Fairness in presentation

Question 9

What is the effect on net income when ending inventory is overstated?

Answer 9

Net income is overstated