. Key ingredients in quality of relevance. 2. Traditional assumptions that influence the FASB's conceptual framework. 3. The idea that information should represent what it purports to represent. 4. An important constraint relating to costs and benefits. 5. An example of conservatism 6. The availability of information when it is needed. 7. Recording an item in the accounting records. 8. Determines the threshold for recognition. 9. Implies consensus. 10. Transactions between independent parties. a) Cost-effectiveness b) Representational faithfulness c) Recognition d) Verifiability e) Time periods f) Unrealized g) Completeness h) Timeliness i) Materiality j) Predictive value k) Economic entity l) Lower-of-cost-or-market rule m) Phrenology n) Arm's-length transactions Now that you have reviewed the terminology, for each situation listed below, indicate by letter the appropriate qualitative characteristic(s) or accounting concept(s) applied. A letter may be used more than once, and more than one characteristic or concept may apply to a particular situation. Explain why you chose your answer. Goodwill is recorded in the accounts only when it arises from the purchase of another entity at a price higher than the fair market value of the purchased entity's identifiable assets. Land is valued at cost. All payments out of petty cash are debited to Miscellaneous Expense.
Already registered? Login
Not Account? Sign up
Enter your email address to reset your password
Back to Login? Click here