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CFAS - Quiz 4

The document appears to be a series of multiple choice questions about the conceptual framework for financial reporting. It tests understanding of the purposes of the conceptual framework, which include providing a foundation for consistent standards over time but not assisting with regulatory rules. It also addresses the qualitative characteristics of useful financial information, including relevance, faithful representation, predictive value, and freedom from material error. The conceptual framework aims to increase user understanding and confidence in financial reporting.

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Sanyln Acla
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0% found this document useful (0 votes)
205 views5 pages

CFAS - Quiz 4

The document appears to be a series of multiple choice questions about the conceptual framework for financial reporting. It tests understanding of the purposes of the conceptual framework, which include providing a foundation for consistent standards over time but not assisting with regulatory rules. It also addresses the qualitative characteristics of useful financial information, including relevance, faithful representation, predictive value, and freedom from material error. The conceptual framework aims to increase user understanding and confidence in financial reporting.

Uploaded by

Sanyln Acla
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Question

0 / 2 pts
Which is not a purpose of having a Conceptual Framework?
You Answered
  
To provide a foundation from which to build more useful and consistent pronouncements
over time.
 

  
To enable the profession to solve emerging practical problems more quickly.
 
Correct Answer
  
To assist regulatory agencies in issuing rules and regulations for a particular industry.
 

  
To assist regulatory agencies in issuing rules and regulations for a particular industry.
 
 
Question 2
0 / 2 pts
Which statement is not true concerning the Conceptual Framework

  
The Conceptual Framework should increase users' understanding and confidence in
financial reporting.
 

  
The Conceptual Framework should allow practical problems to be solved more quickly.
 
You Answered
  The Conceptual Framework should be a basis for standard setting.
 
Correct Answer
  
The Conceptual Framework should be based on fundamental truth derived from the law of
nature.
 
 
Question 3
2 / 2 pts
What are the attributes that make the information provided in the financial statements
useful to the readers?

  
Elements of financial statements
 

  
Objectives of financial reporting
 

  
Quantitative characteristics of financial inforrmation
 
Correct!
  
Qualitative characteristics of financial information
 
 
Question 4
2 / 2 pts
Qualitative characteristics

  
Are considered either fundamental or enhancing.
 

  All of the choices are correct.


 

  
Contribute to the decision-usefulness of financial reporting information.
 

  
Distinguish better information from inferior information for decision-making purposes.
 
 
Question 5
0 / 2 pts
The fundamental qualitative characteristics are

  
Relevance and faithful representation and materiality
 
You Answered
  
Faithful representation and materiality
 
Correct Answer
  
Relevance and faithful representation
 

  
Relevance and reliability
 
 
Question 6
2 / 2 pts
Accounting information is considered relevant when it

  
Is understandable by reasonably informed users of accounting information.
 
Correct!
  
Is capable of making difference in a decision
 

  
Is verifiable and neutral.
 

  
Can be depended on to represent the economic conditions and events that is intended to
represent.
 
 
Question 7
2 / 2 pts
The ingredients of relevant financial information are

  
Predictive value, confirmatory value and timeliness
 

  
Predictive value, confirmatory value, timeliness and materiality
 

  
Predictive value, confirmatory value and materiality
 
Correct!
  
Predictive value and confirmatory value
 
 
Question 8
2 / 2 pts
What is the quality of information that gives assurance that is reasonably free from error
and bias?

  
Relevance
 

  
Verifiability
 
Correct!
  
Faithful representation
 

  
Neutrality
 
 
Question 9
2 / 2 pts
Which of the following is the best description of "faithful representation" in relation to
information in financial statements? 
Correct!
  
Freedom from material error
 

  
Influence on the economic decisions of users
 

  
Comprehensibility to users
 

  
Inclusion of a degree of caution
 
 
Question 10
2 / 2 pts
To achieve faithful representation, the financial statements

  
Must possess all of these.
 

  
Must have predictive and confirmatory value
 

  
Are understandable, comparable, verifiable and timely.
 
Correct!
  
Must be complete, neutral and reasonably free from error
 
 

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