Question;Ex. 2-150?Accounting concepts?identification.;Presented below are a number of accounting;procedures and practices in Ramirez Corp. For each of these items, list the;assumption, principle, qualitative characteristic, or constraint that is;violated.;1. Because the company?s income is low this;year, a switch from accelerated depreciation to straight-line depreciation is;made this year.;2. The president of Ramirez Corp. believes it is;foolish to report financial information on a yearly basis. Instead, the;president believes that financial information should be disclosed only when;significant new information is available related to the company?s operations.;3. Ramirez Corp. decides to establish a large;loss and related liability this year because of the possibility that it may;lose a pending patent infringement lawsuit. The possibility of loss is;considered remote by its attorneys.;4. An officer of Ramirez Corp. purchased a new;home computer for personal use with company money, charging miscellaneous;expense.;Ex. 2-151?Accounting concepts?matching.;Listed below are several qualitative;characteristics, accounting principles and assumptions. Match the letter of;each with the appropriate phrase that states its application. (Items a through k may be used more than once or not at all.);a. Economic entity assumption g. Expense recognition principle;b. Going concern assumption h. Full disclosure principle;c. Monetary unit assumption i. Relevance;d. Periodicity assumption j. Faithful representation;e. Historical cost principle k. Comparability;f. Revenue recognition principle;1. Stable-dollar;assumption (do not use historical cost principle).;2. Key factor is when the performance obligation is satisfied.;3. Presentation;of error-free information.;4. Yearly;financial reports.;5. Recording;annual depreciation.;6. Useful;standard measuring unit for business transactions.;7. Notes;as part of necessary information to a fair presentation.;8. Affairs;of the business distinguished from those of its owners.;9. Business;enterprise assumed to have a long life.;10. Valuing;assets at amounts originally paid for them.;11. Application;of the same accounting principles as in the preceding year.;12. Summarizing;significant accounting policies.;13. Presentation;of timely information with predictive and feedback value.
Paper#55038 | Written in 18-Jul-2015Price : $22