Question 1

A principle contains elements observable by empirical techniques.

Accepted Answer

A) True 
 B)False

Question 2

Under which of the following theories would the accounting equation be Total Assets = Total Equities (including liabilities)?

Accepted Answer

A)  Residual equity theory 
B)  Proprietary theory 
C)  Entity theory 
D)  Commander theory 
A)  Residual equity theory 
B)  Proprietary theory 
C)  Entity theory 
D)  Commander theory

Question 3

The APB was the first to successfully derive an underlying framework of postulates and principles.

Accepted Answer

A) True 
 B)False

Question 4

Recognition and Matching are examples of:

Accepted Answer

A)  Input-oriented principles 
B)  Output-oriented principles 
C)  Constraining principles 
D)  Both a and c 
A)  Input-oriented principles 
B)  Output-oriented principles 
C)  Constraining principles 
D)  Both a and c

Question 5

When the business is viewed in the context of accounting as well as in its legal form, it is clear that the entity is identical to its owners.

Accepted Answer

A) True 
 B)False

Question 6

Output-oriented principles are broad rules that guide the accounting function.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is not true regarding the time period postulate?

Accepted Answer

A)  It results in an artificial segmentation of a continuing process. 
B)  It has led to accrual accounting. 
C)  It allows different accounting methods to be followed in interim periods. 
D)  It allows interim reports to include estimates of annual amounts. 
A)  It results in an artificial segmentation of a continuing process. 
B)  It has led to accrual accounting. 
C)  It allows different accounting methods to be followed in interim periods. 
D)  It allows interim reports to include estimates of annual amounts.

Question 8

Which type of accounting principle is concerned with the comparability of financial statements of different firms?

Accepted Answer

A)  Input-oriented principles 
B)  Output-oriented principles 
C)  Constraining principles 
D)  Both a and c 
A)  Input-oriented principles 
B)  Output-oriented principles 
C)  Constraining principles 
D)  Both a and c

Question 9

The key group in Moonitz's set of postulates consists of postulates stemming from accounting itself.

Accepted Answer

A) True 
 B)False

Question 10

One reason ARS 1 and ARS 3 fell short of the goal of obtaining a framework for APB accounting opinions is that the accounting profession refused to abandon historical cost.

Accepted Answer

A) True 
 B)False

Question 11

Disclosure will become less important in the future because of market efficiency.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is not a reason why ARS 1 and ARS 3 fell short of the goal of obtaining a framework for APB accounting opinions?

Accepted Answer

A)  The authors refused to abandon historical cost. 
B)  The postulates were not complete and therefore could not exclude all value systems other than the one prescribed in the principles. 
C)  At least one of the principles was not derived from any of the postulates. 
D)  The question of whether valuations of various assets were additive became an issue. 
A)  The authors refused to abandon historical cost. 
B)  The postulates were not complete and therefore could not exclude all value systems other than the one prescribed in the principles. 
C)  At least one of the principles was not derived from any of the postulates. 
D)  The question of whether valuations of various assets were additive became an issue.

Question 13

Which type of accounting principle is concerned with general approaches or rules for preparing financial statements and their content?

Accepted Answer

A)  Input-oriented principles 
B)  Output-oriented principles 
C)  Constraining principles 
D)  Both a and c 
A)  Input-oriented principles 
B)  Output-oriented principles 
C)  Constraining principles 
D)  Both a and c

Question 14

Which of the following postulates is violated when liquidation values for assets and equities are reported under ordinary circumstances?

Accepted Answer

A)  Entities 
B)  Time period 
C)  Consistency 
D)  Going concern 
A)  Entities 
B)  Time period 
C)  Consistency 
D)  Going concern

Question 15

Which of the following is an accurate overall label for the terms postulates and principles?

Accepted Answer

A)  Constraints 
B)  Concepts 
C)  Axioms 
D)  Conventions 
A)  Constraints 
B)  Concepts 
C)  Axioms 
D)  Conventions

Question 16

Which of the following is not a true statement?

Accepted Answer

A)  A principle is a statement of a true and generalized nature containing referents to the real world. 
B)  If a principle could be empirically tested and proven true, it would be capable of becoming a law. 
C)  The truth of a law or principle means that is should not be replaced by a newer system. 
D)  Principles are general statements that influence the way we view phenomena and the way we think about problems. 
A)  A principle is a statement of a true and generalized nature containing referents to the real world. 
B)  If a principle could be empirically tested and proven true, it would be capable of becoming a law. 
C)  The truth of a law or principle means that is should not be replaced by a newer system. 
D)  Principles are general statements that influence the way we view phenomena and the way we think about problems.

Question 17

Which of the following are defined in the text as the result of the process of identifying, classifying, and interpreting various phenomena or precepts?

Accepted Answer

A)  Concepts 
B)  Principles 
C)  Postulates 
D)  Axioms 
A)  Concepts 
B)  Principles 
C)  Postulates 
D)  Axioms

Question 18

When we view the business entity in the context of accounting, as well as in its legal form, it is clear that:

Accepted Answer

A)  The entity is separate from its owners. 
B)  The entity is identical to its owners. 
C)  The pooling method should be used for business combinations. 
D)  Entities should be considered as one unit as a result of one controlling the other(s). 
A)  The entity is separate from its owners. 
B)  The entity is identical to its owners. 
C)  The pooling method should be used for business combinations. 
D)  Entities should be considered as one unit as a result of one controlling the other(s).

Question 19

Discuss the matching principle and how it applies to recognizing expenses. Why is the matching principle currently under attack?

Accepted Answer

Expenses are costs that expire as a resu

Question 20

Which of the following are defined in the text as general approaches utilized in the recognition and measurement of accounting events?

Accepted Answer

A)  Concepts 
B)  Principles 
C)  Postulates 
D)  Axioms 
A)  Concepts 
B)  Principles 
C)  Postulates 
D)  Axioms

A principle contains elements observable by empirical techniques.

Under which of the following theories would the accounting equation be Total Assets = Total Equities (including liabilities)?

The APB was the first to successfully derive an underlying framework of postulates and principles.

Recognition and Matching are examples of:

When the business is viewed in the context of accounting as well as in its legal form, it is clear that the entity is identical to its owners.

Output-oriented principles are broad rules that guide the accounting function.

Which of the following is not true regarding the time period postulate?

Which type of accounting principle is concerned with the comparability of financial statements of different firms?

The key group in Moonitz's set of postulates consists of postulates stemming from accounting itself.

One reason ARS 1 and ARS 3 fell short of the goal of obtaining a framework for APB accounting opinions is that the accounting profession refused to abandon historical cost.

Disclosure will become less important in the future because of market efficiency.

Which of the following is not a reason why ARS 1 and ARS 3 fell short of the goal of obtaining a framework for APB accounting opinions?

Which type of accounting principle is concerned with general approaches or rules for preparing financial statements and their content?

Which of the following postulates is violated when liquidation values for assets and equities are reported under ordinary circumstances?

Which of the following is an accurate overall label for the terms postulates and principles?

Which of the following is not a true statement?

Which of the following are defined in the text as the result of the process of identifying, classifying, and interpreting various phenomena or precepts?

When we view the business entity in the context of accounting, as well as in its legal form, it is clear that:

Discuss the matching principle and how it applies to recognizing expenses. Why is the matching principle currently under attack?

Which of the following are defined in the text as general approaches utilized in the recognition and measurement of accounting events?

An Introduction to Accounting Theory

Accounting Theory and Accounting Research

Development of Institutional Structure of Financial Accounting

The Economics of Financial Reporting Regulation

The Search for Objectives

The Fasbs Conceptual Framework

Usefulness of Accounting Information to Investors and Creditors

Uniformity and Disclosure: Some Policy Making Directions

International Accounting

The Balance Sheet

The Income Statement

Statements of Cash Flows

Accounting for Inflation and Changing Prices

Income Taxes and Financial Accounting

Pensions and Other Postretirement Benefits

Leases

Intercorporate Equity Investments

Filters

Exam 5: Postulates, Principles, and Concepts

A principle contains elements observable by empirical techniques.

Under which of the following theories would the accounting equation be Total Assets = Total Equities (including liabilities)?

The APB was the first to successfully derive an underlying framework of postulates and principles.

Recognition and Matching are examples of:

When the business is viewed in the context of accounting as well as in its legal form, it is clear that the entity is identical to its owners.

Output-oriented principles are broad rules that guide the accounting function.

Which of the following is not true regarding the time period postulate?

Which type of accounting principle is concerned with the comparability of financial statements of different firms?

The key group in Moonitz's set of postulates consists of postulates stemming from accounting itself.

One reason ARS 1 and ARS 3 fell short of the goal of obtaining a framework for APB accounting opinions is that the accounting profession refused to abandon historical cost.

Disclosure will become less important in the future because of market efficiency.

Which of the following is not a reason why ARS 1 and ARS 3 fell short of the goal of obtaining a framework for APB accounting opinions?

Which type of accounting principle is concerned with general approaches or rules for preparing financial statements and their content?

Which of the following postulates is violated when liquidation values for assets and equities are reported under ordinary circumstances?

Which of the following is an accurate overall label for the terms postulates and principles?

Which of the following is not a true statement?

Which of the following are defined in the text as the result of the process of identifying, classifying, and interpreting various phenomena or precepts?

When we view the business entity in the context of accounting, as well as in its legal form, it is clear that:

Discuss the matching principle and how it applies to recognizing expenses. Why is the matching principle currently under attack?

Which of the following are defined in the text as general approaches utilized in the recognition and measurement of accounting events?

An Introduction to Accounting Theory

Accounting Theory and Accounting Research

Development of Institutional Structure of Financial Accounting

The Economics of Financial Reporting Regulation

The Search for Objectives

The Fasbs Conceptual Framework

Usefulness of Accounting Information to Investors and Creditors

Uniformity and Disclosure: Some Policy Making Directions

International Accounting

The Balance Sheet

The Income Statement

Statements of Cash Flows

Accounting for Inflation and Changing Prices

Income Taxes and Financial Accounting

Pensions and Other Postretirement Benefits

Leases

Intercorporate Equity Investments

Filters