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— ws




AN INTRODUCTION TO ACCOUNTING THEORY TR
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UE/FALSE QUESTIONS ws




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




3. Accounting theory includes conceptual frameworks, accounting legislation, valuation models, and hypotheses
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and theories.
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ANSWER: True ws




4. Hypotheses and theories are based on an informal method of investigat
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ion. ANSWER: False
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5. Replacement cost as a measure of asset value is generally more reliable than historica
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l cost. ANSWER: False
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6. Accounting theory is developed and refined by the process of accounting rese
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arch. ANSWER: True
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7. Indirect measures are usually preferable to direct measures because they are less costly to o
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btain. 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 me
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asure. ANSWER: False
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2

,10. The simplest type of measuring system is the nominal sc
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ale. ANSWER: True
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11. A chart of accounts is an example of an ordinal classificat
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ion. 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 ws




13. In a ratio scale, the zero point implies "nothingness," or the absence of the quality being me
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asured. ANSWER: True
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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 measu
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rers. ANSWER: True
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16. Assessment measures are not concerned with particular attributes of obje
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cts. ANSWER: False
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17. Prediction measures are concerned with factors that may be indicative of future condit
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ions. ANSWER: True
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18. Timeliness and cost are pertinent to assessment measures but are not pertinent to prediction mea
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sures. ANSWER: False
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19. All accounting measurements are of either the assessment or the prediction var
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iety. ANSWER: True
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, 20. The need for information on a timely basis may conflict with cost constraints in some situ
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ations. ANSWER: Truews ws




21. The terms calculation and measurement both refer to the valuation of a real phenomena or att
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ribute. 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 ws




23. FIFO and LIFO measures of cost of goods sold and inventories are examples of calculations rath
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er than measurements.
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ANSWER: True ws




24. There are often trade- ws ws ws

offs between objectivity and the usefulness of numbers generated by the measurement process.
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ANSWER: True ws




25. Measurement is an integral part of accounting theo ws ws ws ws ws ws ws




ry. ANSWER: True
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26. Throughout the financial history of the United States, current value has been the accepted valuation syst
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em for published financial statements.
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ANSWER: False ws




27. The discounted cash flow approach can be used to determine an objective measurement for most ass
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ets and liabilities.
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ANSWER: False ws




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 service
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s in the economy.
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ANSWER: True ws




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