Essay

Testbank

to accompany

Contemporary Issues in Accounting

Michaela Rankin, Patricia Stanton, Susan McGowan, Matthew Tilling, Kimberly Ferlauto & Carol Tilt

Prepared by

Matt Tilling

© John Wiley & Sons Australia, Ltd 2012

Chapter 2 The Conceptual Framework for Financial Reporting

Multiple Choice Questions

1. How does the conceptual framework differ from an accounting standard?

a. The principles in the conceptual framework are specific in nature while accounting standards provide more general requirements for financial reporting

*b. The principles in the conceptual framework are general concepts while accounting standards provide specific requirements for a particular area of financial reporting

c. The principles in the conceptual framework are designed to provide guidance and apply to a limited range of decisions relating to the preparation of financial reports while accounting standards apply to a wider range of decisions relating to the preparation of financial reports

d. The principles in the conceptual framework provide specific requirements for a particular area of financial reporting while accounting standards are designed to provide general guidance

Correct answer: b

Learning Objective 2.1 ~ Explain what a conceptual framework is.

2. The accounting conceptual framework is what kind of theory?

a. Abstract

*b. Normative

c. Positive

d. Emergent

Correct answer: b

Learning Objective 2.1 ~ Explain what a conceptual framework is.

3. The Conceptual Framework:

a. Is based on the one Pacioli included in Particularis de Computis et Scripturis

b. Is used by every country that has adopted the International Accounting Standards

*c. Was a joint project between the AASB and FASB

d. Has remained unchanged for over 20 years

Correct answer: c

Learning Objective 2.2 ~ Understand the history, evolution of and current developments in the Conceptual Framework for Financial Reporting.

4. Which of the...