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WorksheetsACC407 Chapter 2
Total questions: 12
Worksheet time: 7mins
Which of the following is the fundamental qualitative characteristics of the conceptual framework for financial reporting ?
Relevance
Verifiability
Timeliness
Understandability
________________ concepts assume that a business will continue in operation indefinitely.
Materiality
Prudence
Going concern
Neutrality
The financial statements should not be prepared with the intention to influence certain decisions. This is in accordance with the __________concept.
comparibility
neutrality
consistency
materiality
Which of the following qualitative characteristics relates to the fact that an information is complete, neutral and free from error?
Verifiability
Faithful representation
Consistency
Relevant
________ characteristic requires financial information to be comprehensible.
Verifiabilty
Comparabilty
Understandabilty
Timeliness
The going concern assumption assumes that ______________.
the business will be liquidated in the near future.
the business’s sole concern is to ensure the accuracy of the financial records.
the business will presents useful information in yearly basis.
the business will continue on long period of time to carry out its existing objective and commitments
The accounting concept that states the recorded business activities should be kept separated from the recorded activities of its owner is the ___________ concept.
comparability
economic entity
monetary measurement
neutrality
“The transaction in bookkeeping is concerned only with those facts which can be measured in monetary terms”. This is in line with the _______ concept.
going concern
comparability
consistency
money measurement
The financial statements should not be prepared with the intention to influence certain decisions. This is in accordance with the ________ concept.
consistency
comparability
going concern
neutrality
The consistency concept states that ___________ .
a business should only record business transactions that can be stated in terms of a currency.
a business should change its auditor from year to year.
the same accounting methods should be used from year to year.
a business should not change the owners of a business.
Which of the following is true concerning comparability concept?
Business should record all relevant financial information whether it is favorable or not favorable for users decision making
Users can carry out trend analysis and analyse whether the business’s performance and position has improved across time.
Each business transaction has two aspects known as debit and credit.
Incomes and expenses incurred should be charged to the statement profit or loss in the same accounting period.
Identify three (3) accounting concepts applicable of Mell Cosmetics and Beauty business organization.
money measurement
consistency
accruals
entity concept
going concern
