Chapter 2 Sol - Chapter 2 EXERCISE 2-1(a Feedback Value(b Cost\/Benefit and Materiality(c Neutrality(d Consistency(e Neutrality EXERCISE 2-2(a

Chapter 2 Sol - Chapter 2 EXERCISE 2-1(a Feedback Value(b...

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Chapter 2 EXERCISE 2-1 (a) Feedback Value. (f) Relevance and Reliability. (b) Cost/Benefit and Materiality. (g) Timeliness. (c) Neutrality. (h) Relevance. (d) Consistency. (i) Comparability. (e) Neutrality. (j) Verifiability. EXERCISE 2-2 (a) Comparability. (f) Relevance. (b) Feedback Value. (g) Comparability and Consistency. (c) Consistency. (h) Reliability. (d) Neutrality. (i) Relevance and Reliability. (e) Verifiability. (j) Timeliness. EXERCISE 2-3 (a) Gains, losses. (b) Liabilities. (c) Investment by owners, comprehensive income (also possible would be revenues and gains). (d) Distribution to owners. (Note to instructor: net effect is to reduce equity and assets). (e) Comprehensive income (also possible would be revenues and gains). (f) Assets. (g) Comprehensive income. (h) Revenues, expenses. (i) Equity. (j) Revenues. (k) Distributions to owners. (l) Comprehensive income. 1
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EXERCISE 2-4 (a) 6. Matching principle. (b) 5. Historical cost principle. (c) 7. Full disclosure principle. (d) 2. Going concern assumption. (e) 11. Conservatism. (f) 1. Economic entity assumption. (g) 4. Periodicity assumption. (h) 10. Industry practices. (i) 9. Materiality. (j) 3. Monetary unit assumption. EXERCISE 2-5 (a) Historical cost principle.
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