Answer: Term number that matches the TERM PHRASE phrase. 1. Neutrality Important in analysis between firms. 2 2. Comparability Accounting information should be unbiased. 1 3. Consistency The decision to include an amount in the financial 5 statements. 4. Cost-effectiveness Applying the same accounting practices over time. 3 5. Recognition Considers the value of using information relative to 4 cost of providing it. of Learning: 2 Medium Learning Objective: 01-06 Learning Objective: 01-07 Learning Objective: 01-09 Topic Area: Conceptual framework―Purpose Area: Concepts―Qualitative characteristics Topic Area: Concepts―Recognition–Measurement–Disclosure Blooms: Understand AACSB: Reflective thinking AICPA: BB Critical Thinking AICPA: FN Measurement 111. Listed below are five terms are followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the correct number code for the term. Term number that matches the phrase. TERM PHRASE 1. Monetary unit assumption Implies consensus among different observers. ____ 2. Verifiability Assumes all transactions can be identified ____ with a particular entity. 3. Economic entity assumption Assumes an entity will continue to operate ____ indefinitely. 4. Going concern assumption Requires reporting the financial life of an ____ entity in discrete time frames. 5. Periodicity assumption Ignores the possibility of inflation. ____ Answer: Term number that matches the phrase. TERM PHRASE 1. Monetary unit assumption Implies consensus different observers. 2 2. Verifiability Assumes all transactions can be identified 3 with a particular entity. 3. Economic entity assumption Assumes an entity will continue to operate 4 indefinitely. 4. Going concern assumption Requires reporting the financial life of an 5
Answer: TERM PHRASE Term number that matches the phrase. 1. Neutrality Important in analysis between firms. 2 2. Comparability Accounting information should be unbiased. 1 3. Consistency The decision to include an amount in the financial statements. 5 4. Cost-effectiveness Applying the same accounting practices over time. 3 5. Recognition Considers the value of using information relative to cost of providing it. 4 of Learning: 2 Medium Learning Objective: 01-06 Learning Objective: 01-07 Learning Objective: 01-09 Topic Area: Conceptual framework―Purpose Area: Concepts―Qualitative characteristics Topic Area: Concepts―Recognition–Measurement–Disclosure Blooms: Understand AACSB: Reflective thinking AICPA: BB Critical Thinking AICPA: FN Measurement 111. Listed below are five terms are followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the correct number code for the term. TERM PHRASE Term number that matches the phrase. 1. Monetary unit assumption Implies consensus among different observers. ____ 2. Verifiability Assumes all transactions can be identified with a particular entity. ____ 3. Economic entity assumption Assumes an entity will continue to operate indefinitely. ____ 4. Going concern assumption Requires reporting the financial life of an entity in discrete time frames. ____ 5. Periodicity assumption Ignores the possibility of inflation. ____ Answer: TERM PHRASE Term number that matches the phrase. 1. Monetary unit assumption Implies consensus different observers. 2 2. Verifiability Assumes all transactions can be identified with a particular entity. 3 3. Economic entity assumption Assumes an entity will continue to operate indefinitely. 4 4. Going concern assumption Requires reporting the financial life of an 5