Test Bank For Intermediate Accounting 9th Edition By Spiceland

,Chapter 1 Environment and Theoretical Structure of Financial Accountin
m m m m m m m m


g
True/FalsemQuestions

1. Themprimarymfunctionmofmfinancialmaccountingmismtomprovidemrelevantmfinancialminformation
mtom
partiesmexternalmtombusinessmenterprises.

Answer:mTrue
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
01
TopicmArea:mEnvironmentmofmfinancialmaccountingmandmreporti
ngmBlooms:mRemember
AACSB:mReflectivemthinking
mAICPA:mBBmCriticalmThinki

ng


2. Accrualmaccountingmattemptsmtommeasuremrevenuesmandmexpensesmthatmoccurredmduri
ngmaccountingmperiodsmsomtheymequalmnetmoperatingmcashmflow.

Answer:mFalse
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
02
TopicmArea:mCashmversusmaccrualmaccountin
gmBlooms:mUnderstand
AACSB:mReflectivemthinkin
gmAICPA:mFNmMeasurement


3. ThemFASBmismcurrentlymthempublic-
sectormorganizationmresponsiblemformsettingmaccountingmstandardsminmthemUnitedmStates.

Answer:mFalse
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
03
TopicmArea:mDevelopmentmofmaccountingmandmreportingmstandar
dsmBlooms:mRemember
AACSB:mReflectivemthinkin
gmAICPA:mBBmLegal


4. ThemFASB’smduemprocessminvitesmvariousminterestedmpartiesmtomindicatemtheirmopinionsmab
outmwhethermfinancialmaccountingmstandardsmshouldmbemchanged.

Answer:mTrue
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
04
TopicmArea:mGAAP―Standard-
settingmprocessmBlooms:mRemember
AACSB:mReflectivemthinkin
IntermediatemAccounting,mNinthmEdition,mCopyrightm©m2018mMcGraw-
HillmEducation.
distribution m Allm
mwithout rights
mthe mreserved.
mprior mwritten
mmNo mreproduction
consent mor
mofmMcGraw- 1–1
HillmEducation.

,Chapter 1 Environment and Theoretical Structure of Financial Accountin
m m m m m m m m


g g AICPA: BB Legal
m m m




5. Accountingmformstock-
basedmcompensationmismanmareaminmwhichmthemFASBmhasmreceivedmlittlempoliticalminterferen
ce.




IntermediatemAccounting,mNinthmEdition,mCopyrightm©m2018mMcGraw-
HillmEducation.
distribution m Allm
mwithout rights
mthe mreserved.
mprior mwritten
mmNo mreproduction
consent mor
mofmMcGraw- 1–2
HillmEducation.

, Chapter 1 Environment and Theoretical Structure of Financial Accountin
m m m m m m m m


g
Answer:mFalse
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
04
TopicmArea:mGAAP―Standard-
settingmprocessmBlooms:mRemember
AACSB:mReflectivemthinkin
gmAICPA:mBBmLegal


6. ThemPublicmReformmandmInvestormProtectionmActmofm2002m(Sarbanes-
Oxley)mchangedmthementitymresponsiblemformsettingmauditingmstandardsminmthemUnitedmStates.

Answer:mTrue
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
05
TopicmArea:mEncouragingmhigh-
qualitymfinancialmreportingmBlooms:mRemember
AACSB:mReflectivemthinkin
gmAICPA:mBBmLegal


7. Amrules-basedmapproachmtomstandard-
settingmstressesmprofessionalmjudgmentmasmopposedmtomfollowingmamlistmofmrules.

Answer:mFalse
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
05
TopicmArea:mEncouragingmhigh-
qualitymfinancialmreportingmBlooms:mRemember
AACSB:mReflectivemthinking
mAICPA:mBBmCriticalmThinki

ng


8. Undermfederalmsecuritiesmlaws,mthemSECmhasmthemauthoritymtomsetmaccountingmstandardsmin
mthem
UnitedmStates.

Answer:mTrue
LevelmofmLearning:m1mEas
ymLearningmObjective:m01-
03
TopicmArea:mDevelopmentmofmaccountingmandmreportingmstandar
dsmBlooms:mRemember
AACSB:mReflectivemthinkin
gmAICPA:mBBmLegal


9. ThemprimarymresponsibilitymformproperlymapplyingmGAAPmwhenmcommunicatingmwithminvest
orsmandmcreditorsmthroughmfinancialmstatementsmliesmwithmamfirm'smauditors.
IntermediatemAccounting,mNinthmEdition,mCopyrightm©m2018mMcGraw-
HillmEducation.
distribution m Allm
mwithout rights
mthe mreserved.
mprior mwritten
mmNo mreproduction
consent mor
mofmMcGraw- 1–3
HillmEducation.