1. Historical cost2. Revenue recognition3. Going concern assumption4. Reporting entity concept5. Monetary unit concepta.b.C.d.e.Transactions are recorded in terms of units of money.Transactions are recorded based on the actual amount received or paid.Indicates that personal and business record keeping should be kept separate.Performance obligation has been satisfied.Businesses are expected to continue operating indefinitely.

1. Historical cost = b. Transactions are recorded based on the actual amount received or paid.This…

Answered: 1. Historical cost 2. Revenue…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter3: Accrual Accounting

Section: Chapter Questions

Problem 1MCQ: Which of the following statements is true? Under cash-basis accounting, revenues are recorded when a...

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Similar questions

Companies need to report both monetary and nonmonetary data and information. A. Define these two terms and provide examples of each. B. Discuss what sources are available that provide companies with both types of data and information.
That a business may only report activities on financial statements that are specifically related to company operations, not those activities that affect the owner personally, is known as which of the following? A. separate entity concept B. monetary measurement concept C. going concern assumption D. time period assumption
Define the measurement principle. Select one: a. Requirement that accounting records should all be reported in a single currency. O b. Assumption that a business will continue to operate into the foreseeable future. O c. Accounting for purchases must be at their original cost. d. Transactions should be recorded on the basis of objective evidence where different people looking at the evidence would all arrive at the same conclusion.
An area of information that shows a company's ability to manage its assets, such as inventory and accounts receivable. Select one: O a. Solvency b. Liquidity c. Profitability d. Operations Management O
Revenue is recorded when services have been performed or products have been delivered to customers. The accounting prin supporting this reporting is a. the adjusting principle. b. the income statement principle. O c. the cash basis principle. O d. the revenue recognition principle.
The approach to preparing financial statements based on recording revenues when products and services are delivered and recording expenses when incurred is: Multiple Choice • Cash basis accounting. • The expense recognition (Matching) principle. • The time period assumption. • Accrual basis accounting. • Revenue basis accounting.
Which of the following is NOT a purpose of the Transaction Processing System?a. managing and reporting on the status of financial investmentsb. converting economic events into financial transactionsc. distributing essential information to operations personnel to support their daily operationsd. recording financial transactions in the accounting records
43. The purchase of supplies on credit to be use on the main office of the entity, will cause a corresponding what effect on corresponding accounts? a. Increase in assets and decrease in liabilities b. Both increase in assets and liabilities c. Increase in liabilities and decrease in assets d. Both decrease in assets and liabilities
Revenue is earned when ________. A. the business has received cash from the customer B. the journal entry to record revenue has been prepared C. (or as) the business satisfies each performance obligation D. there is a binding agreement to provide goods or services
Accounting is the process of matching Select one: a. Revenues and Costs b. Potential and Real performance c. Cash inflows and outflows d. Benefits and Costs Accounting provides information on Select one: a. All of the answers are correct b. Financial conditions of an institution c. Company's tax liability for a particular year d. Cost and income for managers Public Accounting, as a sub-discipline of accounting, includes: Select one: a. Management Accounting b. Cost accounting c. Internal auditing d. Managerial Advisory services
1. Explain and describe the type of information needed by each of these users: Revenue expenses profitability debt 2. Explain each accounting principles Accrual principle Conservatism principle Consistency principle Cost principle Economic entity principle Full disclosure principle Going concern principle Matching principle Materiality principle Monetary unit principle Reliability principle Revenue recognition principle Time period principle 3. Define and explain each qualitative characteristics of useful financial information: Verifiability Timeliness Understandability Comparability 4. Differentiate the types of business according to its activity: Service business Merchandising business Manufacturing business
1. Which of the following is NOT a financial transaction?a. purchase of productsb. cash receiptsc. update valid vendor filed. sale of inventory 2. The following are subsystems of the Accounting Information System, EXCEPTa. Transaction Processing System.b. Human Resources System.c. General Ledger/Financial Reporting System.d. Management Reporting System. 3. Which of the following is NOT a purpose of the Transaction Processing System?a. managing and reporting on the status of financial investmentsb. converting economic events into financial transactionsc. distributing essential information to operations personnel to support their dailyoperationsd. recording financial transactions in the accounting records 4. The objectives of the data collection activity of the general model for Accounting InformationSystems are to collect data that area. relevant and redundant.b. efficient and objective.c. efficient and redundant.d. efficient and relevant. 5. Which of the following is NOT a…

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