TEST BANK FOR ACCOUNTING THEORY CONCEPTUAL ISSUE IN A POLITICAL AND ECONOMIC ENVIRONMENT 9TH EDITION BY HARRY. I WALK, JAMES L. DADD ALL 17 CHAPTERS COVERED ISBN:9781483375045

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— wq




AN INTRODUCTION TO ACCOUNTING THEORY T
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RUE/FALSE QUESTIONS wq




1. Financial accounting refers to accounting information that is used by management for decision-
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wq making purposes. ANSWER: False
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2. Accounting theory includes the basic rules, definitions, and principles that underlie the drafting of acc
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ounting standards and how they are derived.
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ANSWER: True wq




3. Accounting theory includes conceptual frameworks, accounting legislation, valuation models, and hypothese
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s and theories.
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ANSWER: True wq




4. Hypotheses and theories are based on an informal method of investig
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ation. ANSWER: False
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5. Replacement cost as a measure of asset value is generally more reliable than historic
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al cost. ANSWER: False
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6. Accounting theory is developed and refined by the process of accounting res
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earch. ANSWER: True
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7. Indirect measures are usually preferable to direct measures because they are less costly to
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obtain. ANSWER: False
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8. Assessment measures are concerned with particular attributes of objects and are always direct measure
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ments. ANSWER: False
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9. When a direct assessment measure is used, there is always only one correct m
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easure. ANSWER: False
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2

,10. The simplest type of measuring system is the nominal s
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cale. ANSWER: True
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11. A chart of accounts is an example of an ordinal classific
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ation. ANSWER: False
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12. Numerals assigned in ordinal rankings indicate an order of preference where the degree of preference
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among ranks is the same.
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ANSWER: False wq




13. In a ratio scale, the zero point implies "nothingness," or the absence of the quality being m
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easured. ANSWER: Truewq wq




14. Using ratio scale measurement is possible in accounti
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ng. ANSWER: True
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15. Objectivity may be defined as the degree of consensus among meas
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urers. ANSWER: True
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16. Assessment measures are not concerned with particular attributes of obj
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ects. ANSWER: False
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17. Prediction measures are concerned with factors that may be indicative of future cond
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itions. ANSWER: True
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18. Timeliness and cost are pertinent to assessment measures but are not pertinent to prediction m
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easures. ANSWER: False
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19. All accounting measurements are of either the assessment or the prediction v
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ariety. ANSWER: True
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3

, 20. The need for information on a timely basis may conflict with cost constraints in some sit
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uations. ANSWER: True
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21. The terms calculation and measurement both refer to the valuation of a real phenomena or a
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ttribute. ANSWER: False
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22. Calculations attempt to simulate or come as close as possible to the measurement of real pheno
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mena or attributes.
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ANSWER: False wq




23. FIFO and LIFO measures of cost of goods sold and inventories are examples of calculations rat
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her than measurements.
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ANSWER: True wq




24. There are often trade-
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offs between objectivity and the usefulness of numbers generated by the measurement process.
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ANSWER: True wq




25. Measurement is an integral part of accounting the
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ory. ANSWER: True
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26. Throughout the financial history of the United States, current value has been the accepted valuation sy
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stem for published financial statements.
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ANSWER: False wq




27. The discounted cash flow approach can be used to determine an objective measurement for most as
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sets and liabilities.
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ANSWER: False wq




28. A general price-
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level adjustment refers to the purchasing power of the monetary unitary unit relative to all goods and servic
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es in the economy.
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ANSWER: True wq




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