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F Ch2 problems

F Ch2 problems - 1 TRUE 1_f_.S. 2_t_ 3_f_ 4

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1. T R U E O R F A L S E 1. __f__ Most countries require companies to follow U.S. GAAP in preparing their financial statements. 2. __t__ Companies face many uncertainties when preparing their financial statements. 3. __f__ A liability is defined as a future economic benefit that an organization owns or controls. 4. __f__ Creation of U.S. GAAP is primarily done by the U.S. government. 5. __f__ In order for investors to evaluate the financial information of a company, it is vital that the financial  information be exact. 6. __f__ Materiality depends on the size of the organization. 7. __f__ Material misstatements made on financial statements are acceptable as long as there are only a few  of them. 8. __t__ An example of an uncertainty faced by companies in financial statements is a pending lawsuit. 9. __f__ Only accountants need to understand the terminology of accounting.
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