69.Issuance of common stock for cash affects which basic element of financial statements? a.Revenues.b.Losses.c.Liabilities.d.Equity. 70.Which basic element of financial statements arises from peripheral or incidental transactions? 71.Which of the following is not a basic assumption underlying the financial accounting structure? 72.Which basic assumption is illustrated when a firm reports financial results on an annual basis? 73.Which basic assumption may not be followed when a firm in bankruptcy reports financial results? a.Economic entity assumption.b.Going concern assumption.c.Periodicity assumption.d.Monetary unit assumption. 74.Which accounting assumption or principle is being violated if a company provides financial reports in connection with a new product introduction? 2 - 15
Test Bank for Intermediate Accounting, Four Thir teenth Edition 2 - 16
Conceptual Framework Underlying Financial Accounting S 75.Which of the following basic accounting assumptions is threatened by the existence of severe inflation in the economy? 2 - 17
Test Bank for Intermediate Accounting, Four Thir teenth Edition S 76. During the lifetime of an entity accountants produce financial statements at artificial points in time in accordance with the concept of 77.Under current GAAP, inflation is ignored in accounting due to the a.economic entity assumption.b.going concern assumption.c.monetary unit assumption.d.periodicity assumption. 78.The economic entity assumption 79.Preparation of consolidated financial statements when a parent-subsidiary relationship exists is an example of the
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