Accounting Principles Quiz

The personal assets of the owner of a company will not appear on the company's SOFP because of which accounting principle?

Which accounting principle requires a company's SOFP to report its land at the amount the company paid to acquire the land?

Which accounting principle allows a company to ignore the change in the purchasing power of the dollar over time?

Which accounting rule is associated with the assumption that the company will continue on long enough to carry out its goals?

Accountants might recognize losses but not gains in certain situations, such as accountant need to record the closing inventory value in the lowest cost / market value.

Which principle/rule directs a company to show all the expenses related to its revenues of a specified period?

When straight line method is used to estimate the depreciation of the furniture, it can be changed to another depre calculation method such as reducing balance method.

Is this statement true or false?

• True

• False

A large company purchases a $250 digital camera and expenses it immediately. This practice may be acceptable because of which principle/guideline?

• Matching

• Materiality

• Historical Cost

• Going concern

A corporation pays its annual property tax bill in one payment. This is an example of which accounting principle/guideline? [即一年总额，若多付要扣；少给要加的概念]

• Historical Cost

• Money Measurement

• Conservatism

• Matching

Which principle does “substance over form” emphasize?

• Legal compliance over judgment

• Prioritizing rules over interpretation

• Economic reality over legal structure

• Recording transactions as they appear in contracts