Question 1

2 / 2 pts
For information to be useful, the linkage between the users and the decisions made is

  
Verifiability
 

  
Faithful representation
 
Correct!
  
Understandability
 

  
Relevance
 
 
Question 2
2 / 2 pts
Which statement is true in relation to the enhancing quality of understandability?

  
Users are expected to have significant business knowledge.
 
Correct!
  
Users have a reasonable knowledge of business and economic activities and review the
information with reasonable diligence.
 

  
Financial statements shall be free from material error.
 

  
Financial statements shall exclude complex matters.
 
 
Question
2 / 2 pts
The overriding qualitative characteristic of accounting information is

  
Faithful representation
 
Correct!
  
Decision usefulness
 

  
Understandability
 

  
Relevance
 
 
Question 4
2 / 2 pts
Which of the following terms best describes information that influences the economic
decisions of users?
Correct!
  
Relevant
 

  
Understandable
 

  
Reliable
 

  
Prospective
 
 
Question 5
2 / 2 pts
What is the quality of information that enables users to better forecast future operations?

  
Relevance
 
Correct!
  
Relevance
 

  
Faithful representation
 

  
Materiality
 
 
Question 6
2 / 2 pts
According to the Conceptual Framework, predictive value and confirmatory value are
ingredients of

  
Comparability
 

  
Relevance
 

  
Faithful representation
 

  
Understandability
 
 
Question 7
2 / 2 pts
Which term best describes information in financial statements that is neutral?
   
Relevant
 

  
Understandable
 
Correct!
  
Unbiased
 

  
Comparable
 
 
Question 8
2 / 2 pts
What is the general objective of financial statements?
Correct!
  
To provide information about economic resources of an entity, claims against the entity
and changes in the economic resources and claims.
 

  
To assess future cash flows to the entity
 

  
To satisfy the information needs of users of financial statements
 

  
To assess management stewardship of economic resources
 
 
Question 9
2 / 2 pts
A reporting entity is

  
Necessarily an economic entity.
 

  
Necessarily a legal entity.
 
Correct!
  
An entity that is required or chooses to prepare financial statements.
 

  
A regulatory government authority.
 
 
Question 10
2 / 2 pts
A reporting entity

  
Can comprise more than one entity
 

  
Can be a single entity
 
Correct!
  
All of these can be considered a reporting entity.
 

  
Can be a portion of a single entity