©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
Financial Accounting Exam #1 Questions
With Correct Answers
Which of the following statements is false?
a. The focus of financial accounting is on the creation of financial information that will be used
chiefly by managers of a business in making decisions about adding or removing product lines.✓
b. The focus of managerial accounting is on the creation of financial information that will be
used chiefly by managers of a business in making decisions about the performance of divisions
or departments within the firm.
c. The focus of financial accounting is on the creation of financial information that will assist
investors and creditors when making decisions about whether to invest in the stock of the firm or
extend loans to the firm.
d. Managerial accounting information may be prepared in a manner that fits the needs of
management rather than the external investment community. - answer✔a. The focus of financial
accounting is on the creation of financial information that will be used chiefly by managers of a
business in making decisions about adding or removing product lines.
, ©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
According to the conceptual framework jointly developed by the IASB and the FASB, financial
information is relevant when it - answer✔provides predictive or confirmatory value.
The primary source of generally accepted accounting principles (GAAP) in the United States at
this time is the: - answer✔Financial Accounting Standards Board (FASB).
According to the conceptual framework jointly developed by the IASB and the FASB,
fundamental qualitative characteristics of financial reporting include: - answer✔Relevance and
faithful representation.
The principal benefit of a single set of global financial reporting standards is - answer✔Increased
ease of international capital flow.
Which of the following statements is true?
a. U.S. generally accepted accounting principles (GAAP) are principles-based.
b. International financial reporting standards (IFRS) are principles-based.
c. U.S. GAAP is less detailed than IFRS.
d. U.S. GAAP involves more judgement in the application of accounting principles. - answer✔b.
International financial reporting standards (IFRS) are principles-based.
Compared to International Financial Reporting Standards (IFRS), U.S. GAAP - answer✔is less
prone to legal difficulty because U.S. GAAP is rules-based, while IFRS is principles-based.
12/3/2024 11:27AM
Financial Accounting Exam #1 Questions
With Correct Answers
Which of the following statements is false?
a. The focus of financial accounting is on the creation of financial information that will be used
chiefly by managers of a business in making decisions about adding or removing product lines.✓
b. The focus of managerial accounting is on the creation of financial information that will be
used chiefly by managers of a business in making decisions about the performance of divisions
or departments within the firm.
c. The focus of financial accounting is on the creation of financial information that will assist
investors and creditors when making decisions about whether to invest in the stock of the firm or
extend loans to the firm.
d. Managerial accounting information may be prepared in a manner that fits the needs of
management rather than the external investment community. - answer✔a. The focus of financial
accounting is on the creation of financial information that will be used chiefly by managers of a
business in making decisions about adding or removing product lines.
, ©SIRJOEL EXAM SOLUTIONS
12/3/2024 11:27AM
According to the conceptual framework jointly developed by the IASB and the FASB, financial
information is relevant when it - answer✔provides predictive or confirmatory value.
The primary source of generally accepted accounting principles (GAAP) in the United States at
this time is the: - answer✔Financial Accounting Standards Board (FASB).
According to the conceptual framework jointly developed by the IASB and the FASB,
fundamental qualitative characteristics of financial reporting include: - answer✔Relevance and
faithful representation.
The principal benefit of a single set of global financial reporting standards is - answer✔Increased
ease of international capital flow.
Which of the following statements is true?
a. U.S. generally accepted accounting principles (GAAP) are principles-based.
b. International financial reporting standards (IFRS) are principles-based.
c. U.S. GAAP is less detailed than IFRS.
d. U.S. GAAP involves more judgement in the application of accounting principles. - answer✔b.
International financial reporting standards (IFRS) are principles-based.
Compared to International Financial Reporting Standards (IFRS), U.S. GAAP - answer✔is less
prone to legal difficulty because U.S. GAAP is rules-based, while IFRS is principles-based.
