Accounting for Pensions and Postretirement Benefits 20-1
CHAPTER 1
FINANCIAL ACCOUNTING AND
ACCOUNTING STANDARDS
IFRS questions are available at the end of this chapter.
TRUE-FALSE—Conceptual
Answer No. Description
F 1. Definition of financial accounting.
T 2. Purpose of financial statements.
T 3. Definition of financial accounting.
T 4. Capital allocation process.
F 5. Objective of financial reporting.
T 6. Decision-Usefulness approach.
T 7. Users of financial statements.
F 8. Committee on Accounting Procedure.
F 9. Passage of FASB standards.
T 10. Financial Accounting Concepts.
T 11. Creation of Accounting Principles Board.
F 12. FASB Codification.
T 13. Code of Professional Conduct.
F 14. GAAP and political action.
,20-2 Accounting for Pensions and Postretirement Benefits
T 15. Public Company Accounting Oversight Board.
T 16. Expectations gap.
F 17. Financial reports.
F 18. Fair value information.
F 19. International Financial Reporting Standards.
F 20. Ethical issues.
MULTIPLE CHOICE—Conceptual
Answer No. Description
a 21. Financial accounting.
d 22. Users of financial reports.
d 23. Identify the major financial statements.
a 24. Financial reporting entity.
d 25. Differences between financial and managerial accounting.
b 26. Financial reporting communication.
b 27. Managerial accounting.
a 28. Capital allocation process.
d 29. Efficient use of resources.
d 30. Capital allocation process.
c 31. Financial statement information.
c 32. Accounting profession challenge.
c 33. Financial reporting objective.
d 34. Financial statements primary users.
c 35. Investor’s decision making.
MULTIPLE CHOICE—Conceptual (cont.)
, Accounting for Pensions and Postretirement Benefits 20-3
Answer No. Description
b 36. Accrual accounting.
c 37. Objective of financial reporting perspective.
c 38. Meaning of “generally accepted.”
b 39. Common set of standards and procedures.
a 40. Limitation of general purpose financial statements.
c 41. Securities and Exchange Commission and accounting standard setting.
d 42. Due process in FASB standard setting.
d 43. Organizations responsible for setting accounting standards.
b 44. Reason for Accounting Principles Board creation
b 45. Organization issuing Accounting Research Bulletins.
a 46. Characteristic of GAAP.
c 47. Characteristics of GAAP.
d 48. FASB accounting standards.
c 49. FASB standard passage.
b 50. Purpose of Emerging Issues Task Force.
a 51. AICPA role in standard setting.
c 52. Role of SEC.
c 53. Powers of the SEC.
d 54. SEC enforcement.
d 55. Creation of FASB.
d 56. Appointment of FASB members.
a 57. Purpose of the Financial Accounting Foundation.
b 58. Characteristics of FASB.
b 59. FASB and "due process" system.
, 20-4 Accounting for Pensions and Postretirement Benefits
b 60. Publications of FASB.
c 61. Purpose of FASB Technical Bulletins.
d 62. Purpose of Emerging Issues Task Force.
b 63. Role of the AICPA.
b 64. Pronouncement issued by the APB.
c 65. Standard setting organizations.
d 66. Identification of standard setting organizations.
c 67. Statements of financial accounting concepts.
P
d 68. FASB members.
P
d 69. FASB statement process.
d 70. Nature of GAAP.
d 71. Body which promulgates GAAP.
d 72. Publications which are not GAAP.
d 73. Publications which are not GAAP.
b 74. Code for Professional Conduct Rule 203.
c 75. Purpose of FASB staff position.
c 76. Components of GAAP.
a 77. Political environment of standard setting.
c 78. International Accounting Standards Board.
CHAPTER 1
FINANCIAL ACCOUNTING AND
ACCOUNTING STANDARDS
IFRS questions are available at the end of this chapter.
TRUE-FALSE—Conceptual
Answer No. Description
F 1. Definition of financial accounting.
T 2. Purpose of financial statements.
T 3. Definition of financial accounting.
T 4. Capital allocation process.
F 5. Objective of financial reporting.
T 6. Decision-Usefulness approach.
T 7. Users of financial statements.
F 8. Committee on Accounting Procedure.
F 9. Passage of FASB standards.
T 10. Financial Accounting Concepts.
T 11. Creation of Accounting Principles Board.
F 12. FASB Codification.
T 13. Code of Professional Conduct.
F 14. GAAP and political action.
,20-2 Accounting for Pensions and Postretirement Benefits
T 15. Public Company Accounting Oversight Board.
T 16. Expectations gap.
F 17. Financial reports.
F 18. Fair value information.
F 19. International Financial Reporting Standards.
F 20. Ethical issues.
MULTIPLE CHOICE—Conceptual
Answer No. Description
a 21. Financial accounting.
d 22. Users of financial reports.
d 23. Identify the major financial statements.
a 24. Financial reporting entity.
d 25. Differences between financial and managerial accounting.
b 26. Financial reporting communication.
b 27. Managerial accounting.
a 28. Capital allocation process.
d 29. Efficient use of resources.
d 30. Capital allocation process.
c 31. Financial statement information.
c 32. Accounting profession challenge.
c 33. Financial reporting objective.
d 34. Financial statements primary users.
c 35. Investor’s decision making.
MULTIPLE CHOICE—Conceptual (cont.)
, Accounting for Pensions and Postretirement Benefits 20-3
Answer No. Description
b 36. Accrual accounting.
c 37. Objective of financial reporting perspective.
c 38. Meaning of “generally accepted.”
b 39. Common set of standards and procedures.
a 40. Limitation of general purpose financial statements.
c 41. Securities and Exchange Commission and accounting standard setting.
d 42. Due process in FASB standard setting.
d 43. Organizations responsible for setting accounting standards.
b 44. Reason for Accounting Principles Board creation
b 45. Organization issuing Accounting Research Bulletins.
a 46. Characteristic of GAAP.
c 47. Characteristics of GAAP.
d 48. FASB accounting standards.
c 49. FASB standard passage.
b 50. Purpose of Emerging Issues Task Force.
a 51. AICPA role in standard setting.
c 52. Role of SEC.
c 53. Powers of the SEC.
d 54. SEC enforcement.
d 55. Creation of FASB.
d 56. Appointment of FASB members.
a 57. Purpose of the Financial Accounting Foundation.
b 58. Characteristics of FASB.
b 59. FASB and "due process" system.
, 20-4 Accounting for Pensions and Postretirement Benefits
b 60. Publications of FASB.
c 61. Purpose of FASB Technical Bulletins.
d 62. Purpose of Emerging Issues Task Force.
b 63. Role of the AICPA.
b 64. Pronouncement issued by the APB.
c 65. Standard setting organizations.
d 66. Identification of standard setting organizations.
c 67. Statements of financial accounting concepts.
P
d 68. FASB members.
P
d 69. FASB statement process.
d 70. Nature of GAAP.
d 71. Body which promulgates GAAP.
d 72. Publications which are not GAAP.
d 73. Publications which are not GAAP.
b 74. Code for Professional Conduct Rule 203.
c 75. Purpose of FASB staff position.
c 76. Components of GAAP.
a 77. Political environment of standard setting.
c 78. International Accounting Standards Board.
