No. 125 Brgy.

San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
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REVISED CONCEPTUAL FRAMEWORK

1. Which is not within the scope of the Revised Conceptual Framework?

a. Objective of financial statements
b. Qualitative characteristics of financial statements
c. Recognition and measurement of basic elements
d. Generally accepted accounting principles

2. The Revised Conceptual Framework is comprised of how many chapters?

a. Six
b. Eight
c. Ten
d. Twelve

3. Which statement is incorrect concerning the Revised Conceptual Framework?

a. The Framework is not a PFRS and therefore does not define standard for any
particular measurement or disclosure issue
b. The Framework is concerned with general purpose financial statements
including consolidated financial statements
c. In cases of conflict, the requirements of the Framework prevail over those of
the relevant PFRS
d. The Framework applies to the financial statements of all commercial, industrial
and business reporting entities, whether in public or private sector

4. Under the Revised Conceptual Framework of Financial Reporting, users of financial

information may be classified into
a. Heavy users (management) and slight users (public, government)
b. Primary users (existing and potential investors and creditors) and other users
c. Internal users (employees, customers) and external users (investors, creditors)
d. Main users (existing investors, creditors) and incidental users (potential
investors, creditors)

5. Which is not within the definition of an asset under the Revised Conceptual
Framework?
a. An asset is a present economic resource
b. The economic resource is a right that has the potential to produce economic
benefits
c. The economic resource is controlled by the entity as a result of past event
d. Future economic benefit is expected to flow to entity

6. What is the new definition of liability under the Revised Conceptual Framework?
a. A present obligation of the entity arising from past event the settlement of which
is expected to result in an inflow of economic benefit
b. A present obligation of the entity arising from present event
c. A present obligation of the entity to transfer an economic resource as a result
of past event
d. An obligation that the entity has practical ability to avoid

7. It is the residual interest in the assets of the enterprise after deducting all its liabilities
a. Revenue
b. Expenses
c. Net income
d. Equity

8. It is defined as increase in economic benefits during the accounting period in the form
of inflows or enhancements of assets or decreases in liabilities that result in increases
in equity, other than those relating to contributions from equity participants
a. Gain
b. Income
c. Profit
d. Revenue

1|P a g e RSORIANO/JMAGLINAO
 No. 125 Brgy. San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
Gmail : icarecpareview@gmail.com

9. It is the process of determining the monetary amounts at which the elements are to be
recognized and carried in the balance sheet and income statement
a. Measurement
b. Recognition
c. Reporting
d. Interpreting

10. It is the process of incorporating in the balance sheet or income statement an item that
meets the definition of an element of financial statements.
a. Recognition
b. Allocation
c. Realization
d. Summarization

11. In financial accounting, revenues and expenses are often included in the determination
of net income even though no cash receipts or disbursements have occurred. This
practice is based on the concept of
a. Time period
b. Historical cost
c. Going concern
d. Accrual basis

12. This is an assumption by accountants that a business will continue to operate

indefinitely unless specific evidences to the contrary exist, as for example, an
impending bankruptcy
a. Matching principle
b. Going concern principle
c. Cost principle
d. Objectivity principle

13. Which underlying concept serves as the basis for preparing financial statements at
regular intervals?
a. Accounting entity
b. Going concern
c. Accounting period
d. Stable monetary unit

14. The financial statements should be stated in terms of a common financial denominator
a. Accrual
b. Going concern
c. Time period
d. Monetary unit

15. “Freedom from error” relates to which qualitative characteristic of the Revised
Conceptual Framework?
a. Faithful representation
b. Relevance
c. Understandability
d. Verifiability

“For I know the plans I have for you, declares the

Lord. Plans to prosper you and not to harm you.
Plans to give you hope and a future.”

-Jeremiah 29:11

Key Answers - DBCBDCDBAADBCDA

Accounting Lecture Series - https://www.youtube.com/channel/UCZFe6nDndodLuCmkc9sNlGA

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