ACCTNG Answers of Chapter 3
ACCTNG Answers of Chapter 3
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ANSWER: TRUE
https://www.ifrs.org/-/media/project/conceptual-
framework/fact-sheet-project-summary-and- EXPLANATION: The new conceptual
feedback-statement/conceptual-framework-project- framework deleted the notion of an expected
summary.pdf flow of future economic benefits and clarifies
that the asset is the right and not the ultimate
P.G. 70
inflow of economic benefits from that right.
it stresses that the right is what the entity
controls and not the future economic benefits.
(ge focus ari kay ang katungod, dili ang
benipisyo.)
PAGE/LINK/ASSUMPTION: P.G. 69&70
ANSWER:
EXPLANATION:
6. The conceptual framework defines income PAGE/LINK/ASSUMPTION:
and expenses in terms of changes in assets
and liabilities.
PROBLEM 5:
ANSWER: FALSE
EXPLANATION:
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1. Which of the following statements is
incorrect regarding the purpose of the
7. Not all items that meet the definition of a conceptual framework?
financial statement element are recognized;
they are recognized only if recognizing them
will also result in relevant and faithfully ANSWER: D. the conceptual framework
represented information. prescribes the concepts for both general purpose
and specific purpose financial reporting.
EXPLANATION:
ANSWER: TRUE
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EXPLANATION:
PAGE/LINK/ASSUMPTION: P.G. 65
2. The conceptual framework (incorrect
statement)
8. Measuring an asset at historical cost will
always result in the same carrying amount of
the asset from period to period. ANSWER: D. prevails over the PFRS in cases
of conflicts.
EXPLANATION:
ANSWER: TRUE
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EXPLANATION: historical cost will always
result in the same carrying amount of the asset from
period to period.
3. Which of the following is excluded from the
PAGE/LINK/ASSUMPTION: scope of the conceptual framework?
9. According to the conceptual framework,
amortized cost measurement relates to
ANSWER: C. the components of a complete set
historical cost, rather than current value.
of financial statements and their presentation
requirements.
ANSWER: EXPLANATION:
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ANSWER:
EXPLANATION:
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ANSWER: A.
8. Two primary users are using the financial
EXPLANATION:
information of entity A. if user #1 concludes
that entity A’s sales has increased while user PAGE/LINK/ASSUMPTION: P.G. 71
#2 concludes that it has decreased, entity
A’s financial information is not
13. Which of the ff. is correct when determining
the existence of an asset or a liability.
ANSWER: Comparability
EXPLANATION: comparison is not uniformity. 2
ANSWER: C.
items must be similar or dissimilar.
EXPLANATION:
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ANSWER:
ANSWER:
EXPLANATION:
EXPLANATION:
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ANSWER: ANSWER: C.
EXPLANATION: EXPLANATION:
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17. According to the revised conceptual 22. Recognizing a financial statement element
framework, an item is recognized if requires measuring it in monetary terms.
Which of the following statements is
incorrect regarding measurement?
ANSWER:
EXPLANATION:
ANSWER:
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EXPLANATION:
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18. According to the conceptual framework, an
item is recognized if it meets the definition
of an asset, liability, equity, income or 23. Effective communication makes information
expense, and recognizing it would provide more useful. Effective communication
relevant and faithful representation rather requires all of the ff. except
than relevance?
ANSWER:
EXPLANATION:
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PROBLEM 6