Test Bank
Accounting Theory: Conceptual Issues in
a Political and Economic Environment
9th Edition
by Harry I. Wolk, James L. Dodd & John
J. Rozycki
100% Verified Answers| A+ Grade
1
, Chapter 1— ws
AN INTRODUCTION TO ACCOUNTING THEORY TR
ws ws ws ws ws
UE/FALSE QUESTIONS ws
1. Financial accounting refers to accounting information that is used by management for decision-
ws ws ws ws ws ws ws ws ws ws ws ws
ws making purposes. ANSWER: False
ws ws ws
2. Accounting theory includes the basic rules, definitions, and principles that underlie the drafting of acco
ws ws ws ws ws ws ws ws ws ws ws ws ws ws
unting standards and how they are derived.
ws ws ws ws ws ws
ANSWER: True ws
3. Accounting theory includes conceptual frameworks, accounting legislation, valuation models, and hypotheses
ws ws ws ws ws ws ws ws ws ws
and theories.
ws ws
ANSWER: True ws
4. Hypotheses and theories are based on an informal method of investigat
ws ws ws ws ws ws ws ws ws ws
ion. ANSWER: False
ws ws
5. Replacement cost as a measure of asset value is generally more reliable than historica
ws ws ws ws ws ws ws ws ws ws ws ws ws
l cost. ANSWER: False
ws ws ws
6. Accounting theory is developed and refined by the process of accounting rese
ws ws ws ws ws ws ws ws ws ws ws
arch. ANSWER: True
ws ws
7. Indirect measures are usually preferable to direct measures because they are less costly to o
ws ws ws ws ws ws ws ws ws ws ws ws ws ws
btain. ANSWER: False
ws ws
8. Assessment measures are concerned with particular attributes of objects and are always direct measure
ws ws ws ws ws ws ws ws ws ws ws ws ws
ments. ANSWER: False
ws ws
9. When a direct assessment measure is used, there is always only one correct me
ws ws ws ws ws ws ws ws ws ws ws ws ws
asure. ANSWER: False
ws ws
2
,10. The simplest type of measuring system is the nominal sc
ws ws ws ws ws ws ws ws ws
ale. ANSWER: True
ws ws
11. A chart of accounts is an example of an ordinal classificat
ws ws ws ws ws ws ws ws ws ws
ion. ANSWER: False
ws ws
12. Numerals assigned in ordinal rankings indicate an order of preference where the degree of preference
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
among ranks is the same.
ws ws ws ws
ANSWER: False ws
13. In a ratio scale, the zero point implies "nothingness," or the absence of the quality being me
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
asured. ANSWER: True
ws ws
14. Using ratio scale measurement is possible in accounti
ws ws ws ws ws ws ws
ng. ANSWER: True
ws ws
15. Objectivity may be defined as the degree of consensus among measu
ws ws ws ws ws ws ws ws ws ws
rers. ANSWER: True
ws ws
16. Assessment measures are not concerned with particular attributes of obje
ws ws ws ws ws ws ws ws ws
cts. ANSWER: False
ws ws
17. Prediction measures are concerned with factors that may be indicative of future condit
ws ws ws ws ws ws ws ws ws ws ws ws
ions. ANSWER: True
ws ws
18. Timeliness and cost are pertinent to assessment measures but are not pertinent to prediction mea
ws ws ws ws ws ws ws ws ws ws ws ws ws ws
sures. ANSWER: False
ws ws
19. All accounting measurements are of either the assessment or the prediction var
ws ws ws ws ws ws ws ws ws ws ws
iety. ANSWER: True
ws ws
3
, 20. The need for information on a timely basis may conflict with cost constraints in some situ
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
ations. ANSWER: Truews ws
21. The terms calculation and measurement both refer to the valuation of a real phenomena or att
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
ribute. ANSWER: False
ws ws
22. Calculations attempt to simulate or come as close as possible to the measurement of real pheno
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
mena or attributes.
ws ws
ANSWER: False ws
23. FIFO and LIFO measures of cost of goods sold and inventories are examples of calculations rath
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
er than measurements.
ws ws
ANSWER: True ws
24. There are often trade- ws ws ws
offs between objectivity and the usefulness of numbers generated by the measurement process.
ws ws ws ws ws ws ws ws ws ws ws ws
ANSWER: True ws
25. Measurement is an integral part of accounting theo ws ws ws ws ws ws ws
ry. ANSWER: True
ws ws
26. Throughout the financial history of the United States, current value has been the accepted valuation syst
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
em for published financial statements.
ws ws ws ws
ANSWER: False ws
27. The discounted cash flow approach can be used to determine an objective measurement for most ass
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
ets and liabilities.
ws ws
ANSWER: False ws
28. A general price-
ws ws
level adjustment refers to the purchasing power of the monetary unitary unit relative to all goods and service
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
s in the economy.
ws ws ws
ANSWER: True ws
4
Accounting Theory: Conceptual Issues in
a Political and Economic Environment
9th Edition
by Harry I. Wolk, James L. Dodd & John
J. Rozycki
100% Verified Answers| A+ Grade
1
, Chapter 1— ws
AN INTRODUCTION TO ACCOUNTING THEORY TR
ws ws ws ws ws
UE/FALSE QUESTIONS ws
1. Financial accounting refers to accounting information that is used by management for decision-
ws ws ws ws ws ws ws ws ws ws ws ws
ws making purposes. ANSWER: False
ws ws ws
2. Accounting theory includes the basic rules, definitions, and principles that underlie the drafting of acco
ws ws ws ws ws ws ws ws ws ws ws ws ws ws
unting standards and how they are derived.
ws ws ws ws ws ws
ANSWER: True ws
3. Accounting theory includes conceptual frameworks, accounting legislation, valuation models, and hypotheses
ws ws ws ws ws ws ws ws ws ws
and theories.
ws ws
ANSWER: True ws
4. Hypotheses and theories are based on an informal method of investigat
ws ws ws ws ws ws ws ws ws ws
ion. ANSWER: False
ws ws
5. Replacement cost as a measure of asset value is generally more reliable than historica
ws ws ws ws ws ws ws ws ws ws ws ws ws
l cost. ANSWER: False
ws ws ws
6. Accounting theory is developed and refined by the process of accounting rese
ws ws ws ws ws ws ws ws ws ws ws
arch. ANSWER: True
ws ws
7. Indirect measures are usually preferable to direct measures because they are less costly to o
ws ws ws ws ws ws ws ws ws ws ws ws ws ws
btain. ANSWER: False
ws ws
8. Assessment measures are concerned with particular attributes of objects and are always direct measure
ws ws ws ws ws ws ws ws ws ws ws ws ws
ments. ANSWER: False
ws ws
9. When a direct assessment measure is used, there is always only one correct me
ws ws ws ws ws ws ws ws ws ws ws ws ws
asure. ANSWER: False
ws ws
2
,10. The simplest type of measuring system is the nominal sc
ws ws ws ws ws ws ws ws ws
ale. ANSWER: True
ws ws
11. A chart of accounts is an example of an ordinal classificat
ws ws ws ws ws ws ws ws ws ws
ion. ANSWER: False
ws ws
12. Numerals assigned in ordinal rankings indicate an order of preference where the degree of preference
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
among ranks is the same.
ws ws ws ws
ANSWER: False ws
13. In a ratio scale, the zero point implies "nothingness," or the absence of the quality being me
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
asured. ANSWER: True
ws ws
14. Using ratio scale measurement is possible in accounti
ws ws ws ws ws ws ws
ng. ANSWER: True
ws ws
15. Objectivity may be defined as the degree of consensus among measu
ws ws ws ws ws ws ws ws ws ws
rers. ANSWER: True
ws ws
16. Assessment measures are not concerned with particular attributes of obje
ws ws ws ws ws ws ws ws ws
cts. ANSWER: False
ws ws
17. Prediction measures are concerned with factors that may be indicative of future condit
ws ws ws ws ws ws ws ws ws ws ws ws
ions. ANSWER: True
ws ws
18. Timeliness and cost are pertinent to assessment measures but are not pertinent to prediction mea
ws ws ws ws ws ws ws ws ws ws ws ws ws ws
sures. ANSWER: False
ws ws
19. All accounting measurements are of either the assessment or the prediction var
ws ws ws ws ws ws ws ws ws ws ws
iety. ANSWER: True
ws ws
3
, 20. The need for information on a timely basis may conflict with cost constraints in some situ
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
ations. ANSWER: Truews ws
21. The terms calculation and measurement both refer to the valuation of a real phenomena or att
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
ribute. ANSWER: False
ws ws
22. Calculations attempt to simulate or come as close as possible to the measurement of real pheno
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
mena or attributes.
ws ws
ANSWER: False ws
23. FIFO and LIFO measures of cost of goods sold and inventories are examples of calculations rath
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
er than measurements.
ws ws
ANSWER: True ws
24. There are often trade- ws ws ws
offs between objectivity and the usefulness of numbers generated by the measurement process.
ws ws ws ws ws ws ws ws ws ws ws ws
ANSWER: True ws
25. Measurement is an integral part of accounting theo ws ws ws ws ws ws ws
ry. ANSWER: True
ws ws
26. Throughout the financial history of the United States, current value has been the accepted valuation syst
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
em for published financial statements.
ws ws ws ws
ANSWER: False ws
27. The discounted cash flow approach can be used to determine an objective measurement for most ass
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
ets and liabilities.
ws ws
ANSWER: False ws
28. A general price-
ws ws
level adjustment refers to the purchasing power of the monetary unitary unit relative to all goods and service
ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws ws
s in the economy.
ws ws ws
ANSWER: True ws
4
