Full Test Bank For Intermediate Accounting, 11th Edition

Full Test Bank For
Intermediate Accounting, 11th Edition



Answer Key

Test name: chapter 1

1)
TERM PHRASE Term number
that matches
the phrase.
1. Predictive value Information is useful in 1
projecting cash flows.
2. Relevance Pertinent to the decision at 2
hand.
3. Distribution to Information is available prior 5
owners to the decision.
4. Confirmatory Decrease in equity due to 3
value transfers to owners.
5. Timeliness Information confirms 4
expectations.
2)
TERM PHRASE Term number
that matches
the phrase.
1. Gain Along with relevance, a 5
fundamental decision-specific
quality.
2. Materiality Results if an asset is sold for 1
more than book value.
3. Completeness Contains all information 3
necessary for faithful
representation.
4. Comprehensive The change in equity from 4
income nonowner transactions.



Version 1 1

, 5. Faithful Concerns the decision-making 2
representation impact of both the amount and
nature of an item.
3)
TERM PHRASE Term number
that matches
the phrase.
1. Neutrality Important in analysis between 2
firms.
2. Comparability Accounting information should 1
be unbiased.
3. Consistency The decision to include an 5
amount in the financial
statements.
4. Cost-effectiveness Applying the same accounting 3
practices over time.
5. Recognition Considers the value of using 4
information relative to cost of
providing it.
4)
TERM PHRASE Term number
that matches
the phrase.
1. Monetary unit Implies consensus among 2
assumption different observers.
2. Verifiability Assumes all transactions can be 3
identified with a particular
entity.
3. Economic entity Assumes an entity will continue 4
assumption to operate indefinitely.
4. Going concern Requires reporting the 5
assumption financial life of an entity in
discrete time frames.
5. Periodicity Ignores the possibility of 1
assumption inflation.
5)
TERM PHRASE Term number
that matches
the phrase.
1. Historical cost Basis of measurement for fixed 1


Version 1 2

, assets.
2. Materiality
g Discounts future cash flows. g g g 5
3. Revenue
g Occurs when goods or services
g g g g 3
recognition
g are transferred to the customer.
g g g g




4. Full disclosure
g g Reporting of all information g g g 4
that could affect decisions.
g g g


5. Present value
g g Application of GAAP sometimes g g g 2
avoided under this constraint.
g g g




6)
TERM PHRASE Term number g


g that matches
g


the phrase.
g



1. Financial
g Undermines representational g 3
Accounting Standards g faithfulness by being g g


Board
g inconsistent with neutrality.
g g g


2. Accounting
g It established GAAP before the
g g g g 2
Principles Board g FASB.
3. Conservatism
g Its EITF Issues are GAAP when
g g g g g 1
entered in the Accounting g g g


Standards Codification.
g g


4. American
g It has the authority to set U.S.
g g g g g g 5
Institute of CPAs
g g g accounting standards.
g g


(AICPA)
5. Securities and
g g It is the national organization for
g g g g g 4
Exchange Commission
g g CPAs in the United States.
g g g g g




7)
TERM PHRASE Term number g


g that matches
g


the phrase.
g


1. Expenses
g Net assets. g 2
2. Equity
g Outflows of resources to g g g 1
generate revenues.
g g



3. Distributions to
g g Cash dividends. g 3
owners
4. Investments by
g g Claims of creditors against the
g g g g 5
owners assets of a business.
g g g g


5. Liabilities
g Transfers of resources in g g g 4
exchange for common and
g g g g


preferred stock. g




Version 1 3

, 8)
TERM PHRASE Term number g


that matches
g


gthe phrase.
g



1. Losses
g Net outflows from peripheral
g g g 1
transactions.
g


2. Assets
g Increases in equity from the g g g g 3
sale of goods and/or services.
g g g g


3. Revenues
g Results if an asset is sold for g g g g g g 5
more than book value.
g g g g


4. Comprehensive
g All changes in equity except
g g g g 4
income owner transactions. g


5. Gains
g Probable future economic g g 2
benefits controlled by an entity. g g g g




9)
TERM PHRASE Term number g


g that matches
g


the phrase.
g


1. SEC
g Establishes auditing standards in g g g 6
the U.S. for public companies.
g g g g g


2. FASB
g Primary national organization of
g g g 7
accountants working in industry. g g g


3. IASB
g Sets accounting standards in the
g g g g 2
United States. g


4. AICPA
g Provides timely responses tog g g 5
financial reporting issues.
g g g



5. EITF
g The FASB's parent organization.
g g g 10
6. PCAOB
g Advises the FASB. g g 8
7. IMA
g FASB's predecessor.
g 9
8. FASAC
g Regulates the financial reporting g g g 1
for public companies.
g g


9. APB
g National organization of certified
g g g 4
public accountants.
g g



10. FAF g Sets global accounting standards.
g g g 3




Version 1 4