Question

6. Match the qualitative characteristics below with the statements that follow.

Timeliness Faithful

Representation Predictive value

Completeness

Relevance

Confirmatory value

Free from error

Comparability

Neutrality

Understandability

Materiality

a. Quality of information that permits users to identify similarities in and differences between two sets of economic phenomena.

b. Having information available to users before it loses its capacity to influence decisions.

c. Information about an economic phenomenon that has value as an input to the processes used by capital providers to form their own expectations about the future.

d. Information that is capable of making a difference in the decisions of users in their capacity as capital providers.

e. Loose tools are expensed when purchased rather than capitalized.

f. Absence of bias intended to attain a predetermined result or to induce a particular behaviour.

g. Quality of information that assures users that information represents the economic phenomena that it purports to represent.

h. Information about economic phenomenon that changes past or present expectations based on previous evaluations.

i. The extent to which information is accurate in representing the economic substance of a transaction.

j. Includes all the information that is necessary for a faithful representation of economic phenomena that it purports to represent.

k. Quality of information that allows users to comprehend its meaning.

l. All payments out of petty cash are charged to Miscellaneous Expense.

Answer 1

Characteristics Comparability Timeliness Predictive Value Relevance Relevance Neutrality Particulars a. Quality of information that permits users to identify similarities in and differences between two sets of economic phenomena. b. Having information available to users before it loses its capacity to influence decisions. c. Information about an economic phenomenon that| has value as an input to the processes used by capital providers to form their own expectations about the future. d. Information that is capable of making a difference in the decisions of users in their capacity as capital providers. e. Loose tools are expensed when purchased rather than capitalized. f. Absence of bias intended to attain a predetermined result or to induce a particular behaviour. g. Quality of information that assures users that information represents the economic phenomena that it purports to represent. h. Information about economic phenomenon that changes past or present expectations based on previous evaluations. 1. The extent to which information is accurate in representing the economic substance of a transaction. j. Includes all the information that is necessary for a faithful representation of economic phenomena that it purports to represent. k. Quality of information that allows users to comprehend its meaning. I. All payments out of petty cash are charged to Miscellaneous Expense. Faithful Representation Confirmatory Value Free From Error Completeness Understandability Materiality