A company can change to a new method of accounting if management can justify that the new method results in terms of

A company can change to a new method of accounting if management can justify that the new method results in terms of

a. less likelihood of clerical errors.
b. a higher net income.
c. a lower net income for tax purposes.
d. more meaningful financial information.

Answer: D

Under IFRS, what is the label used for common stock?

Under IFRS, what is the label used for common stock?

a. Common shares
b. Share common stock
c. Ordinary shares
d. Share capital

Answer: D

Under IFRS, which of the following current assets section would be presented correctly in accordance with IFRS standards?

Under IFRS, which of the following current assets section would be presented correctly in accordance with IFRS standards?

a. Marketable securities, Land, Cash
b. Short term investments, Cash, Land
c. Short term notes receivable, Accounts receivable, Cash
d. Cash, Intangibles, Short term notes receivable

Answer: C

What is the primary criterion by which accounting information can be judged?

What is the primary criterion by which accounting information can be judged?

a. Usefulness for decision making
b. Consistency
c. Predictive value
d. Comparability

Answer: A

An item is ________ if it is likely to influence the decision of an investor or creditor.

An item is ________ if it is likely to influence the decision of an investor or creditor.

a. consistent
b. material
c. faithful representation
d. comparable

Answer: A

Which of the following are constraints that allow a company to modify generally accepted accounting principles without jeopardizing the usefulness of the financial statements?

Which of the following are constraints that allow a company to modify generally accepted accounting principles without jeopardizing the usefulness of the financial statements?

a. Relevance and faithful representation
b. Cost constraint
c. Timeliness and neutrality
d. Consistency and comparability

Answer: B