. Match accounting assumption with most appropriate statement. A. Time Period F. Expense Recognition B. Materiality...
. Match accounting assumption with most appropriate statement.
|
A. |
Time Period |
F. Expense Recognition |
|
B. |
Materiality |
G. Consistency |
|
C. |
Going Concern |
H. Full Disclosure |
|
D. E. |
Revenue Recognition Business Entity |
I. Transaction Approach J. Historical Cost |
Insert the applicable letter below
|
i. |
Land is purchased for $760,000. The current value of the land is $625,000. Which concept is applied to record the correct amount? |
|
|
ii. |
Wall Street Journal: subscription fees collected in advance are recorded as unearned subscription income and later recognized when earned. |
|
|
iii. |
All significant relevant information is reported. |
|
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iv. |
Discount retailer Target Corporation routinely sends emails announcing sales for preferred customers. No economic impact occurs; therefore, no transaction is recorded. |
|
|
v. |
Online retailer Amazon, Inc. is financially sound and will continue in business indefinitely. |
|
|
vi. |
Costs incurred to provide a service or produce a product must be reported in the same period the revenue is recognized. |
|
|
vii. |
The company uses the same accounting principle from period to period. |
|
|
viii. |
Financial statements are prepared periodically. |
|
Homework Answers
(i) Correct choice is J. Historical cost.
Land will be recorded at historical cost or price paid to acquire it.
(ii) Correct choice is D. Revenue recognition.
Under revenue recognition, Revenue is recognized when earned. So, subscription fees will be recognized when earned in next year.
(iii) Correct choice is B. Materiality
As per materiality concept, all the relevant information that is material should be reported.
(iv) Correct choice is I. Transaction approach
(v) Correct choice is C. Going concern
As per going concern assumption, transactions will be recorded as if the entity will continue to exist indefinitely.
(vi) Correct choice is F. Expense recognition.
As per expense recognition, costs must be reported in the same period in which the related revenue is recognized.
(vii) Correct choice is G. Consistency.
According to consistency, same principles must be followed period to period.
(viii) Correct choice is A. Time period
As per time period assumption, financial statements must be prepared periodically.
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help please
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Question 4.20 points) Match the statements below with the items below: a.) Economic entity assumption b.)...
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Options:
Correctness: Correct or Incorrect
Principle:
a. Faithfull representation
b. Faithful representation (Full disclosure) Materiality
c. Faithful representation (Net asset principle)
d. Historical Cost Measurement
e. Historical cost measurement and Net asset principle, Full
disclosure materiality and separate-entity
f. Matching; Comparability
g. Matching; Time-period assumption
h. Revenue and Historical cost measurement
i. Revenue and matching; Faithful representation and Freedom
from bias
j. Revenue recognition
k. Separate-entity
l. Time-period assumption
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Options:
Correctness: Correct or Incorrect
Principle:
a. Faithfull representation
b. Faithful representation (Full disclosure) Materiality
c. Faithful representation (Net asset principle)
d. Historical Cost Measurement
e. Historical cost measurement and Net asset principle, Full
disclosure materiality and separate-entity
f. Matching; Comparability
g. Matching; Time-period assumption
h. Revenue and Historical cost measurement
i. Revenue and matching; Faithful representation and Freedom
from bias
j. Revenue recognition
k. Separate-entity
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