1.

IFRS stands for

a. International Federation of Reporting Services.
b. Independent Financial Reporting Standards.
c. International Financial Reporting Standards.
d. Integrated Financial Reporting Services.
2. The major key organizations on the international side are the:
a. IASB and IFRS Advisory Council.
b. IOSCO and the U.S. SEC.
c. London Stock Exchange and International Securities Exchange.
d. IASB and IOSCO.
3. Which of the following are not the Importance of the Conceptual Framework?
a. Increase users‘ understanding of and confidence in financial statements;
b. Provides description of current practice;
c. Enhance comparability through standardized accounting practice;
d. All of the above are importance of the Conceptual Framework
4. What is the objective of financial reporting as indicated in the conceptual framework?
a. provide information that is useful to those making investing and credit decisions.
b. provide information that is useful to management.
c. provide information about those investing in the entity.
d. All of the above.
5. The International Accounting Standards Board’s (IASB’s) Conceptual Framework includes all of
the following except:
a. Objective of financial reporting.
b. Supplementary information
c. Elements of financial statements.
d. Qualitative characteristics of accounting information.
6. The second level in the International Accounting Standards Board’s (IASB’s) Conceptual
Framework
a. Identifies the objective of financial reporting.
b. Identifies recognition, measurement, and disclosure concepts used in establishing and
applying accounting standards.
c. Provides the elements of financial statements.
d. Includes assumptions, principles, and constraints.
7. Which of the following is a fundamental quality of useful accounting information?
a. Comparability.
b. Relevance.
c. Consistency.
d. Materiality.
8. Which of the following is an ingredient of relevance?
a. Completeness.
b. Representational faithfulness.
c. Neutrality.
d. Predictive value.
9. What is the quality of information that enables users to better forecast future operations?
 a. Reliability.
b. Materiality.
c. Comparability.
d. Relevance.
10. Which of the following ingredients of fundamental qualities is part of faithful
representation?
a. Neutrality.
b. Productive value.
c. Confirmatory value.
d. Timeliness.
11. The two fundamental qualities that make accounting information useful for decision
making are
a. comparability and consistency.
b. materiality and timeliness.
c. relevance and faithful representation.
d. reliability and comparability.
12. Which of the following is not a basic element of financial statements?
a. Assets.
b. Statement of financial position.
c. Equity.
d. Income.
13. Which of the following is not a basic assumption underlying the financial accounting
structure?
a. Economic entity assumption.
b. Going concern assumption.
c. Periodicity assumption.
d. Historical cost assumption.
14. Which basic assumption is illustrated when a firm reports financial results on an annual
basis?
a. Economic entity assumption.
b. Going concern assumption.
c. Periodicity assumption.
d. Monetary unit assumption.
15. The basic assumptions of accounting used by the International Accounting Standards
Board (IASB) include
a. Monetary unit.
b. Decision usefulness
c. Timeliness.
d. All of the choices are basic assumptions of accounting.
16. An account consists of
a. a title, a debit balance, and a credit balance.
b. a title, a left side, and a debit balance.
c. a title, a debit side, and a credit side.
d. a title, a right side, and a debit balance.
17. An account is a part of the financial information system and is described by all except
which one of the following?
a. An account has a debit and credit side.
b. An account is a source document.
c. An account may be part of a manual or a computerized accounting system.
d. An account has a title.
18. The normal balance of any account is the
a. left side.
b. right side.
c. side which increases that account.
d. side which decreases that account.
19. The double-entry system requires that each transaction must be recorded
a. in at least two different accounts.
b. in two sets of books.
c. in a journal and in a ledger.
d. first as a revenue and then as an expense.
20. The final step in the recording process is to
a. analyze each transaction.
b. enter the transaction in a journal.
c. prepare a trial balance.
d. transfer journal information to ledger accounts.
21. The usual sequence of steps in the transaction recording process is:
a. journal → analyze → ledger.
b. analyze → journal → ledger.
c. journal → ledger →analyze.
d. ledger → journal → analyze.
22. The first step in the recording process is to
a. prepare financial statements.
b. analyze each transaction for its effect on the accounts.
c. post to a journal.
d. prepare a trial balance.
23. The usual sequence of steps in the recording process is to analyze each transaction enter
the transaction in the
a. journal, and transfer the information to the ledger accounts.
b. ledger, and transfer the information to the journal.
c. book of accounts, and transfer the information to the journal.
d. book of original entry, and transfer the information to the journal.
24. A journal provides
a. the balances for each account.
b. information about a transaction in several different places.
c. a list of all accounts used in the business.
d. a chronological record of transactions.
25. The procedure of transferring journal entries to the ledger accounts is called
a. journalizing.
 b. analyzing.
c. reporting.
d. posting.
26. Posting
a. should be performed in account number order.
b. accumulates the effects of journalized transactions in the individual accounts.
c. involves transferring all debits and credits on a journal page to the trial balance.
d. is accomplished by examining ledger accounts and seeing which ones need updating.
27. The trial balance
a. is a listing of all the accounts and their balances in the order the accounts appear on the
statement of financial position.
b. is a listing of all the accounts and their balances in the order the accounts appear on the
statement of financial position.
c. can be used to uncover errors in journalizing and posting.
d. is used to prepare the statement of financial position while the general ledger is used to
prepare the income statement.
28. Which of the following errors will prevent the trial balance from balance?
a. A transaction is not journalized.
b. Transposition error related to the statement of financial position.
c. A journal entry is posted twice.
d. A journal entry to purchase $100 worth of equipment is posted as a $1,000 purchase.
29. A list of accounts and their balances at a given time is called a(n)
a. journal.
b. posting.
c. trial balance.
d. income statement.
30. If the sum of the debit column equals the sum of the credit column in a trial balance, it
indicates
a. no errors have been made.
b. no errors can be discovered.
c. that all accounts reflect correct balances.
d. the mathematical equality of the accounting equation.
31. Which of the following rules is incorrect?
a. Credits decrease the dividends account.
b. Debits increase the share capital-ordinary account.
c. Credits increase revenue accounts.
d. Debits decrease liability accounts.
32. Which of the following is the correct sequence of steps in the recording process?
a. Posting, journalizing, analyzing
b. Journalizing, analyzing, posting
c. Analyzing, posting, journalizing d
d. Analyzing, journalizing, posting