Each of the following statements violates a concept or convention of accounting. Write the letter in the blank next to each statement corresponding to the concept or convention violated. a. Consistency d. Full disclosure b. Materiality e. Cost-benefit c. Conservatism _____ 1. A note to the financial statements indicating a change in inventory methods is omitted. _____ 2. When management is unsure
of which estimates to use in a given situation, the estimate resulting in the largest net income is always used. _____ 3. In 20x5, a company uses straight-line depreciation and in 20x6 the company uses declining-balance depreciation. _____ 4. A small company expenses all expenditures under $10,000. _____ 5. A small company purchases a $50,000 computer to save $3,000 per year in bookkeeping wages.
Fill in the blank(s) with correct word
1. d 4. b
2. c 5. e
3. a
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What is the difference between the process capability ratio Cp and the process capability index Cpk?
What will be an ideal response?
The corporate form of business A)was first known and used by the Greeks and then spread through the Romans to England
B)was not known until the advent of the Industrial Revolution. C)was first allowed in the State of New York around 1811 and is considered to be an American creation. D)is a relatively new concept developed shortly after the Great Depression.
For the entrepreneur who is simply tired of the day-to-day operations of the business, slowly withdrawing cash flows over time may require too much patience.
Answer the following statement true (T) or false (F)
A cash payments journal is a special journal used to record all of the following EXCEPT
A. a payment of an expense by check. B. a cash purchase of supplies. C. a cash withdrawal by the owner. D. an asset accepted as payment by a supplier.