CONCEPTUAL FRAMEWORK
MWF 1:00-2:00 PM
NAME: Janesene N. Sol
ID NUMBER: 46691
ACTIVITY SECTION
ACTIVITY 1: REFLECTION
Why do you want to become a CPA? Aa of today, in which sector of accountancy do you prefer
to work? State your reason.
Academe/Public Practice/Government/Commerce and Industry
I want to become a CPA because I want to fulfill my family’s dream and that is have to
have an accountant and besides I also want to prove to myself that my chosen field isn’t a
mistake, perhaps it will help me to go out from my comfort zone. As of today, I prefer to work in
the Government Sector as an accountant since I’ve always wanted to help the society through
executing my purpose and that is by handling the government funds because I will assure that I
won’t be involve in any corruption or fraudulence which is the main reason why the country is
facing economic crisis.
ACTIVITY 2:
Identify which assumption or principle may be applied to each situation. Give brief explanation.
1. Princess Company does not report bankruptcy yet because they think they can still
continue operations amidst COVID19 pandemic.
Going concern assumption since Princess Company is still confident to continue its
operation indefinitely or even with the pandemic.
2. Assume Apple Company is currently suing Ample Company for copyright violation over its
software package. Since this software package is the only operation the small tech
company does, losing this lawsuit would be detrimental. There is a 95 percent expectation
that Apple will win the lawsuit.
Conservatism because in the point of view of Ample Company the expression of
conservatism must be applied that is to “Anticipate no profit and provide for probable
and measurable loss”.
3. Your business bought a new building for p10,000.00. You recorded the building account
on the same amount.
Historical cost, because the amount of the building was recorded the same from its cost
when the transaction occurred.
4. Thor Company has a receivable from a customer named Loki. Loki recently had problems
with his finances and told Thor that he may not be able to pay his debt. From that day,
Thor Company did not recognize the debt anymore. He recorded that as an expense/loss.
Materiality may be applied since Thor Company already decided to recognize the debt as
an expense/loss so that means that what has not been paid to him has less value or
immaterial for him.
5. Bong No, together with his friends has created a business registered as NoNoNo Company
last 2018. Bong No needed a large amount of money last June 2020 because he was
hospitalized due to COVID. He borrowed from his relatives, and when the due date came,
they told Bong No to just give them the company as payment. Bong No and other owners
refused.
Accounting Entity must be applied, what happened to Bong No must be separated and
out of the company’s concern.
6. Instead of preparing daily financial statements, you prepared financial statements for the
period January 1 to December 31, 2019, your first year of operations. Aside from this
annual report, you also prepared quarterly and semi-annual reports.
Time period may be applied if an accountant need or want to prepare financial reports
for one year or any period.
7. The standard requires you to give detailed information of your cash balance such as its
composition and restrictions, if there are any. You showed these details in the notes to
financial statements.
Full disclosure principle because just as what it means there is a need for significant and
relevant info leading to preparation of financial statement which shall be clearly reported.
EVALUATION
Which part of the discussion did you Which part of the discussion did you
find most enjoyable to learn? find the most difficult?
I find it most enjoyable to learn in the In the part where the financial
part where Accountancy Profession has statements have been discussed,
been discussed. specifically about the statement of cash
flows and notes to financial statements
because I honestly do not have an in-
depth knowledge about it.
Do you have question(s) in mind? Write it here
None
