The ultimate responsibility for the formulation of financial reporting rules in the US rests with: a. Congress b. Financial accounting standards board c. IRS
d. Securities & exchange commission
In countries where the bulk of investment capital is attracted from a broad base of investors, there is a demand for financial statements to report: a. Income on a cash basis
b. Income on a tax basis c. Retained earnings d. The underlying economics
The US requires foreign companies that wish to have securities traded on US exchanges to reconcile their reporting methods to US: a. Congressional law
b. Generally accepted accounting principles c. Generally accepted auditing standards
d. Tax law
When compared to US GAAP, international accounting standards allow:
a. About the same latitude b. Less latitude c. much more latitude
d. No tolerance from US GAAP
According to the SECs statement on International Accounting Standards the SEC requires 3 key elements for acceptance of the IASCs proposed core standards. Which one of the following is a required element?
a. Standards must be routinely interpreted & applied
b. Standards must be in accordance with US gov. accounting (Yellow Book) standards
c. Standards must comply with US GAAP
d. Standards must include a core set of accounting pronouncements that constitute a comprehensive, generally accepted basis of accounting
A decline in the purchasing power of a country's currency is:
a. Abnormal b. Deflation c. Inflation d. Mandatory inflation
When a company uses the current cost accounting approach for dealing with inflation, all non-monetary assets are reflected on the balance sheet at:
a. Current costs at the balance sheet date
b. Future value
c. Net realizable value as of the beginning of the year
d. Price-level adjusted historical cost
General price level accounting is intended to make historical currency amounts expended in different periods: a. Comparable b. Consistent c. Constant d. Equal
Which one of the following accounts is a non-monetary item?
a. Accounts receivable b. Bonds payable c. Inventory d. Investment in bonds
Which of the following accounts is a monetary item?
a. Accounts receivable b. Depreciation expense c. Equipment d. Inventory
In general price level (Constant dollar) accounting, restatement gains & losses on non-monetary assets are: a. Adjusted to owners equity
b. Recorded & reported as extraordinary gains or losses on income statement
c. Recorded & reported as ordinary gains or losses on income statement
d. Recorded & reported as unearned revenue