Test Bank for Accounting Theory Conceptual Issues in a Political and Economic Environment 9th Edition

Test Bank for Accounting Theory Conceptual Issues in a Political and Economic Environment 9th Edition Chapter 1—AN INTRODUCTION TO ACCOUNTING THEORY Accounting Theory: 9 th edition Page 1 of 12 TRUE/FALSE 1. Financial accounting refers to accounting information that is used by management for decisionmaking purposes. ANSWER: F 2. Accounting theory includes the basic rules, definitions, and principles that underlie the drafting of accounting standards and how they are derived. ANSWER: T 3. Accounting theory includes conceptual frameworks, accounting legislation, valuation models, and hypotheses and theories. ANSWER: T 4. Hypotheses and theories are based on an informal method of investigation. ANSWER: F 5. Replacement cost as a measure of asset value is generally more reliable than historical cost. ANSWER: F 6. Accounting theory is developed and refined by the process of accounting research. ANSWER: T