Miscellaneous. Determine whether the statement is true (T) or false (F)

1. The income statement provides information about cash receipts and cash disbursements.
2. The final two steps in the accounting processing cycle are closing the temporary accounts and preparing a post-closing trial balance.
3. The balance sheet is an organized array of assets, liabilities, and shareholders equity grouped in common characteristics. It reports a companys financial position at a point in time.
4. Shareholders equity is a residual amount derived by subtracting liabilities from assets. It arises primarily from paid-in capital and retained earnings. It may also include accumulated other comprehensive income.
5. Summary of significant accounting policies can be found in disclosure notes.
6. Current and quick ratios provide information about a companys long-term solvency.
7. Comprehensive income includes a few types of gains and losses that are not part of net income.
8. Income statement is a change statement. Cash flow statement is a position statement.
9. Under the direct method of reporting operating cash flows, one derives net cash flow by starting with reported net income and adding or subtracting items to convert that amount to a cash basis.
10. Revenues from a long-term contract can only be recognized when all the performance obligations are completed.
11. Under the fair value option of reporting financial investments, unrealized holding gains and losses are recognized in other comprehensive income in the period in which they occur.
12. The cost of a self-constructed building may include some interest incurred during construction.
13. When a company pledges accounts receivable as collateral for a loan, the journal entry includes a debit to financing expense and a credit to accounts receivable.
14. Intangible assets represent exclusive rights that provide benefits to the owner.
15. When a new asset is acquired through non-monetary exchange, gain or loss is recognized for the difference between the fair value and book value of the new asset received.
16. Research and development cost related to a self-developed patent should be capitalized as part of the patent.
17. A debit balance in Fair Value Adjustment indicates that the current market price of the financial security is lower than the purchase price.
18. When the market price of an available-for-sale security drops, the companys net income declines.
19. Trading and AFS securities usually appear as current assets on the balance sheet. But held-to-maturity securities must be reported as noncurrent assets.
20. Billing in excess of CIP (or cost and profit) is a current asset.
21. Unrealized holding loss from a trading (or AFS) security is a liability.
22. Accumulated other comprehensive income is part of shareholders equity.
23. Under the US GAAP, all assets must be reported on the balance sheet at historical cost.
24. The full disclosure principle requires that financial reporting should provide all information that could affect the users decisions.