Tercek Company recognizes revenue during the production cycle. The price of the product and how many items
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Tercek Company recognizes revenue during the production cycle. The price of the product and how many items will be sold are not certain. | ?CompletenessTimeliness CharacteristicRevenue Recognition CriteriaReporting Entity ConceptHistorical CostGoing Concern AssumptionCost ConstraintExpense Recognition CriteriaNo Violation | |||
2. | In preparing its financial statements, Seco Company left out information about its cost flow assumption for inventories. | ?CompletenessRevenue Recognition CriteriaExpense Recognition CriteriaTimeliness CharacteristicReporting Entity ConceptGoing Concern AssumptionHistorical CostCost ConstraintNo Violation | ||
3. | Martinez Company amortizes patents over their legal life of 20 years instead of their economic life, which is usually about five years. | ?Reporting Entity ConceptGoing Concern AssumptionTimeliness CharacteristicNo ViolationRevenue Recognition CriteriaHistorical CostExpense Recognition CriteriaCompletenessCost Constraint | ||
4. | Ravine Hospital Supply Corporation reports only current assets and current liabilities on its balance sheet. Long-term assets and liabilities are reported as current. The company is unlikely to be liquidated. | ?Cost ConstraintRevenue Recognition CriteriaReporting Entity ConceptGoing Concern AssumptionNo ViolationCompletenessHistorical CostExpense Recognition CriteriaTimeliness Characteristic | ||
5. | Barton Company reports merchandise inventory on its balance sheet at its current market value of $100,000. The inventory has an original cost of $110,000. | ?Timeliness CharacteristicRevenue Recognition CriteriaReporting Entity ConceptExpense Recognition CriteriaCompletenessHistorical CostCost ConstraintNo ViolationGoing Concern Assumption | ||
6. | Bonilla Company is in its third year of operations and has not yet issued financial statements. | ?No ViolationExpense Recognition CriteriaRevenue Recognition CriteriaCompletenessReporting Entity ConceptGoing Concern AssumptionTimeliness CharacteristicHistorical CostCost Constraint | ||
7. | Watts Company has merchandise inventory on hand that cost $400,000. Watts reports merchandise inventory on its balance sheet at its current market value of $425,000. | ?Reporting Entity ConceptGoing Concern AssumptionCompletenessTimeliness CharacteristicHistorical CostCost ConstraintNo ViolationExpense Recognition CriteriaRevenue Recognition Criteria | ||
8. | Steph Wolfson, president of the Download Music Company, bought a computer for her personal use. She paid for the computer with company funds and debited the computer account. | ?No ViolationReporting Entity ConceptGoing Concern AssumptionTimeliness CharacteristicExpense Recognition CriteriaRevenue Recognition CriteriaCompletenessCost ConstraintHistorical Cost | ||
9. | Sagoo Company decided not to implement a perpetual inventory system that would save $40,000 annually because the cost of the system was $100,000 and it was estimated to have a 10-year lif |
Related Book For
Accounting Principles Part 3
ISBN: 978-1118306802
6th Canadian edition Volume 1
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Kinnear, Joan E. Barlow
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