Question 1

Please complete the following statementS :
-A consultation process where standard-setters invite interested parties to contribute to the development of accounting standards is known as ________________ .

Accepted Answer

The answer of Please complete the following statementS :
-A consultation...

Question 2

Please complete the following statementS :
-A liability is recognised in the statement of financial position when it is _____________ that an outflow of resources embodying economic benefits will result from the settlement of a present obligation.

Accepted Answer

The answer of Please complete the following statementS :
-A liability...

Question 3

Please complete the following statementS :
-Increases in economic benefits that do not arise in the ordinary course of business are labelled as ______________.

Accepted Answer

The answer of Please complete the following statementS :
-Increases in...

Question 4

Please complete the following statementS :
-If the ____________________ is not assumed, then plant and equipment should be stated at their liquidation value (selling price less costs of disposal), not at their cost.

Accepted Answer

The answer of Please complete the following statementS :
-If the...

Question 5

Please complete the following statementS :
-The Conceptual Framework classifies relevance and faithful representation as _______________ qualitative characteristics.

Accepted Answer

The answer of Please complete the following statementS :
-The Conceptual...

Question 6

a. Briefly explain the essential characteristics in the definition of a liability.
b. What are the criteria that must be satisfied for liabilities to be recognised in the statement of financial position?
c. Using the definition and recognition criteria, explain why the following items are liabilities:
• bank loan
• revenue earned in advance (unearned revenue)
• provision for employees' annual leave

Accepted Answer

The answer of a. Briefly explain the essential characteristics in...

Question 7

Hello Hello Limited is a company that manufactures telephones under its own brand, as well as distributing and selling other telephone brands. Recently Hello Hello has been conducting a research project to develop a mobile phone with various functions that could be used under water. The company is hiring experts from around the world and is spending a considerable amount of money to fund this project. 
Required:Provide a justified opinion of whether the amount spent for the research project should be considered as an asset and recognised in the statement of financial position.

Accepted Answer

The answer of Hello Hello Limited is a company that...

Question 8

Match the descriptions with their terms :
-All circumstances and events that could make a difference to the decisions financial statement users might make should be disclosed in the financial statements.

Accepted Answer

The full disclosure principle requires that all relevant and necessary information for the understanding of a company's financial statements is disclosed, ensuring that users have all the information they need to make informed decisions.

Question 9

Match the descriptions with their terms :
-Liabilities that do not satisfy the recognition criteria.

Accepted Answer

Contingent liabilities are potential liabilities that may or may not be incurred depending on the outcome of a future event. They do not satisfy the recognition criteria because their existence and amount are uncertain until the event occurs.

Question 10

Match the descriptions with their terms :
-A set of concepts defining the nature, purpose, and content of general purpose financial reporting to be followed by financial report preparers and standard-setters.

Accepted Answer

A conceptual framework is a set of concepts defining the nature, purpose, and content of general purpose financial reporting to be followed by financial report preparers and standard-setters.

Question 11

Match the descriptions with their terms :
-Outlines the objective of general purpose financial reporting.

Accepted Answer

The answer of Match the descriptions with their terms :
-Outlines...

Question 12

Match the descriptions with their terms :
-Following consultation with the FASB, the IASB reissued this document in 2010.

Accepted Answer

The Conceptual Framework was reissued by the IASB in 2010 following consultation with the FASB.

Question 13

Match the descriptions with their terms :
-The primary users of general purpose financial reports.

Accepted Answer

General purpose financial reports are primarily designed for the users who are unable to command the preparation of reports tailored to their specific information needs. Resource providers, such as investors and creditors, are the primary users as they rely on this information to make decisions about providing resources to the entity.

Question 14

Match the descriptions with their terms :
-The extent that information presented represents the economic phenomena without bias or material error and has been prepared with appropriate recognition and measurement methods.

Accepted Answer

Verifiability is the extent to which information presented represents the economic phenomena without bias or material error and has been prepared with appropriate recognition and measurement methods.

Question 15

Match the descriptions with their terms :
-A resource controlled by the entity as a result of past events and from which the future economic benefits are expected to flow to the entity.

Accepted Answer

This description matches the definition of "Assets" as per accounting principles, where assets are resources controlled by an entity due to past events and from which future economic benefits are expected to flow to the entity.

Question 16

Match the descriptions with their terms :
-Decreases in economic benefits that do not arise in the ordinary course of business.

Accepted Answer

Losses refer to decreases in economic benefits that do not arise in the ordinary course of business, distinguishing them from regular operational expenses.

Question 17

Match the descriptions with their terms :
-Under this principle, assets are recorded in the accounts at their purchase price.

Accepted Answer

The cost principle dictates that assets should be recorded at their purchase price, which is the cost to acquire them. This principle ensures that the assets are recorded in the financial statements at a measurable and objective amount, providing a consistent basis for recording and reporting.

Question 18

Match the descriptions with their terms :
-A conceptual framework issued by the IASB and adopted by the AASB in 2005.

Accepted Answer

The Conceptual Framework is a document issued by the IASB and adopted by the AASB in 2005, providing guidelines for financial reporting.

Question 19

Match the descriptions with their terms :
-The extent that omissions or misstatements of information could affect users' decisions.

Accepted Answer

Materiality refers to the significance of financial information to decision-making. Information is considered material if omitting it or misstating it could influence the economic decisions of users taken on the basis of the financial statements.

Question 20

Explain why it is necessary to develop a conceptual framework.

Accepted Answer

The answer of Explain why it is necessary to develop...

Quiz 13: Analysing and Integrating Gaap

Please complete the following statementS : -A consultation process where standard-setters invite interested parties to contribute to the development of accounting standards is known as ________________ .

Please complete the following statementS : -A liability is recognised in the statement of financial position when it is _____________ that an outflow of resources embodying economic benefits will result from the settlement of a present obligation.

Please complete the following statementS : -Increases in economic benefits that do not arise in the ordinary course of business are labelled as ______________.

Please complete the following statementS : -If the ____________________ is not assumed, then plant and equipment should be stated at their liquidation value (selling price less costs of disposal), not at their cost.

Please complete the following statementS : -The Conceptual Framework classifies relevance and faithful representation as _______________ qualitative characteristics.

Match the descriptions with their terms : -All circumstances and events that could make a difference to the decisions financial statement users might make should be disclosed in the financial statements.

Match the descriptions with their terms : -Liabilities that do not satisfy the recognition criteria.

Match the descriptions with their terms : -A set of concepts defining the nature, purpose, and content of general purpose financial reporting to be followed by financial report preparers and standard-setters.

Match the descriptions with their terms : -Outlines the objective of general purpose financial reporting.

Match the descriptions with their terms : -Following consultation with the FASB, the IASB reissued this document in 2010.

Match the descriptions with their terms : -The primary users of general purpose financial reports.

Match the descriptions with their terms : -The extent that information presented represents the economic phenomena without bias or material error and has been prepared with appropriate recognition and measurement methods.

Match the descriptions with their terms : -A resource controlled by the entity as a result of past events and from which the future economic benefits are expected to flow to the entity.

Match the descriptions with their terms : -Decreases in economic benefits that do not arise in the ordinary course of business.

Match the descriptions with their terms : -Under this principle, assets are recorded in the accounts at their purchase price.

Match the descriptions with their terms : -A conceptual framework issued by the IASB and adopted by the AASB in 2005.

Match the descriptions with their terms : -The extent that omissions or misstatements of information could affect users' decisions.

Explain why it is necessary to develop a conceptual framework.