STUDY PROBLEM 1-15 MULTIPLE CHOICE QUESTIONS ONS urred while earning revenues arned, and reported 1. The principle stating that all expenses incurred while earnin should be identified with the revenues when they are earned for the same time period is the: A. Cost Principle B. Revenue Principle SVP TO C. Expenses Principle 10 mobilo MSTURE D. Matching Principle n E. Timing Principle 2. The distinct The distinction between a current asset and other assets: A. is based on how long the asset has been owned. B. is based on amounts that will be paid to other entities within a year. C. is based on the ability to determine the current fair market value D. is based upon whether the asset is tangible or intangible E is based on when the asset is expected to be converted to cash, or used to benefit the entity. The purpose of the income statement is to show the: A. change in the fair market value of the assets from the prior income statement B. market value per share of stock at the date of the statement. C. revenues collected during the period covered by the statement. D. net income or net loss for the period covered by the statement. E. all of the above. bob 4. The going concern concept refers to a presumption that:bica A. the entity will be profitable in the coming year. B. the entity will not be involved in a merger within a year. C. the entity will continue to operate in the foreseeable future. D. top management of the entity will not change in the coming year. E. none of the above. 5. The principle of consistency means that: A. the accounting methods used by an entity never change. B. the same accounting methods are used by all firms in an industry. C. the effect of any change in an accounting method will be disclosed the financial statements or notes thereto. D. there are no alternative methods of accounting for the same transaction. E. the balance sheet must always balance.vodoo AG Els AA fa company 6. Which financial statement displays the revenues and expenses of a co for a period of time? A. Income Statement B. Balance Sheet C. Cash Flow Statement D. Statement of Stockholder's Equity. 7. Which of these is not included as a separate item in the basic accountin equation? A. Assets B. Revenues C. Liabilities D. Stockholder's Equity 8. Which financial statement uses the expanded accounting equation? A. Income Statement B. Balance Sheet C. Cash Flow Statement D. Statement of Stockholder's Equity and 9. The accrual basis of accounting records revenues when they are: A. Collected B. Earned C. Contracted To lo long D. Readily Available for use s A 5 tott 10. Asset accounts have what type of balance? A. Debit B. Credit C. Contra D. All of the above. 11. Which account is not a liability account? A. Accounts Payable B. Accrued Expenses C. Cash D. Notes Payable 12. A contra asset account has what type of balance? A. Debit B. Credit C. Contra D. All of the above