Which of the following is an ethical concern of accountants?

Which of the following is an ethical concern of accountants?

a. Earnings manipulation.

b. Conservative accounting.

c. Industry practices.

d. None of the above.





Answer: A

What would be an advantage of having all countries adopt and follow the same accounting standards?

What would be an advantage of having all countries adopt and follow the same accounting standards?

a. Consistency.

b. Comparability.

c. Lower preparation costs.

d. b and c





Answer: D

What is not a reason that accounting standards may differ across countries?

What is not a reason that accounting standards may differ across countries?

a. Governments.

b. Language.

c. Culture.

d. Past Practice.

Answer: B

What is "expectation gap"?

What is "expectation gap"?

a. The difference between what the public thinks the accountant is not doing and what the accountant knows they don't do.

b. The difference between what the public thinks the accountant is doing and what Congress says the accountant is doing.

c. The difference between what the public thinks the accountant is doing and what the accountant thinks they can do.

d. The difference between what the accountant is doing and what the Courts say the accountant should be doing.

Answer: C

What is a possible danger if politics plays too big a role in accounting standard setting?

What is a possible danger if politics plays too big a role in accounting standard setting?

a. Accounting standards that are not truly generally accepted.

b. Individuals may influence the standards.

c. User groups become active.

d. The FASB delegates its authority to elected officials.

Answer: A

What is not a source of pressure that may influence the accounting standard setting process?

What is not a source of pressure that may influence the accounting standard setting process?

a. Congress.

b. Lobbyist.

c. CPA firms.

d. None of the above.






Answer: D

The purpose of the International Accounting Standards Board is to

The purpose of the International Accounting Standards Board is to

a. issue enforceable standards which regulate the financial accounting and reporting of multinational corporations.

b. develop a uniform currency in which the financial transactions of companies throughout the world would be measured.

c. promote uniform accounting standards among countries of the world.

d. arbitrate accounting disputes between auditors and international companies.

Answer: C

Financial accounting standard-setting in the United States

Financial accounting standard-setting in the United States

a. can be described as a social process which reflects political actions of various interested user groups as well as a product of research and logic.

b. is based solely on research and empirical findings.

c. is a legalistic process based on rules promulgated by governmental agencies.

d. is democratic in the sense that a majority of accountants must agree with a standard before it becomes enforceable.

Answer: A

Which of the following is not considered a component of generally accepted accounting principles?

Which of the following is not considered a component of generally accepted accounting principles?

a. FASB Implementation Guides.

b. Widely recognized industry practices.

c. Articles published in CPA journals.

d. AICPA Accounting Interpretations.

Answer: C

What is the purpose of a FASB Staff Position?

What is the purpose of a FASB Staff Position?

a. Provide interpretation of existing standards.

b. Provide a consensus on how to account for new and unusual financial transactions.

c. Provide interpretive guidance.

d. Provide timely guidance on select issues.

Answer: C

Rule 203 of the Code of Professional Conduct addresses:

Rule 203 of the Code of Professional Conduct addresses:

a. ethical requirements.

b. financial statements should be based on generally accepted accounting principles.

c. advertising to obtained clients.

d. auditing financial statements.

Answer: B

Which of the following publications does not qualify as a statement of generally accepted accounting principles?

Which of the following publications does not qualify as a statement of generally accepted accounting principles?

a. Statements of financial standards issued by the FASB

b. Accounting interpretations issued by the FASB

c. APB Opinions

d. Accounting research studies issued by the AICPA

Answer: D

Which of the following is not a part of generally accepted accounting principles?

Which of the following is not a part of generally accepted accounting principles?

a. FASB Interpretations

b. CAP Accounting Research Bulletins

c. APB Opinions

d. All of these are part of generally accepted accounting principles.

Answer: D

Generally accepted accounting principles

Generally accepted accounting principles

a. include detailed practices and procedures as well as broad guidelines of general application.

b. are influenced by pronouncements of the SEC and IRS.

c. change over time as the nature of the business environment changes.

d. all of these.

Answer: D

Members of the Financial Accounting Standards Board are

Members of the Financial Accounting Standards Board are

a. employed by the American Institute of Certified Public Accountants (AICPA).

b. part-time employees.

c. required to hold a CPA certificate.

d. independent of any other organization.





Answer: D

The purpose of Statements of Financial Accounting Concepts is to

The purpose of Statements of Financial Accounting Concepts is to

a. establish GAAP.

b. modify or extend the existing FASB Standards Statement.

c. form a conceptual framework for solving existing and emerging problems.

d. determine the need for FASB involvement in an emerging issue.

Answer: C

An organization that has not published accounting standards is the

An organization that has not published accounting standards is the

a. American Institute of Certified Public Accountants.

b. Securities and Exchange Commission.

c. Financial Accounting Standards Board.

d. All of these have published accounting standards.

Answer: D

Which of the following organizations has not been instrumental in the development of financial accounting standards in the United States?

Which of the following organizations has not been instrumental in the development of financial accounting standards in the United States?

a. AICPA

b. FASB

c. IASB

d. SEC







Answer: C

Which of the following pronouncements were issued by the Accounting Principles Board?

Which of the following pronouncements were issued by the Accounting Principles Board? 

a. Accounting Research Bulletins

b. Opinions

c. Statements of Position

d. Statements of Financial Accounting Concepts

Answer: B

The American Institute of Certified Public Accountants (AICPA) continues to be involved in all of the following except

The American Institute of Certified Public Accountants (AICPA) continues to be involved in all of the following except 

a. developing and enforcing professional ethics.

b. developing auditing standards.

c. providing professional education programs.

d. all of the above.





Answer: B