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31 accounting records all executory promises 32 in the recognition criteria for liab 4297582



31. Accounting records all executory promises. 

32. In the recognition criteria for liabilities with uncertain amount and/or timing, probable is used in U.S. GAAP to refer to a relatively high threshold of likelihood—a rule of thumb used in practice is approximately 80%. 

33. In IFRS, probable as recognition criterion for liabilities with uncertain amount and/or timing means “more likely than not”—approximately 51%. 

34. Under U.S. GAAP, assets and liabilities are listed on the balance sheet in order of decreasing liquidity, so the most liquid assets (liabilities) are shown first, under their respective categories. 

35. Accounting does not normally recognize mutually unexecuted contracts as assets or liabilities. 

36. What is a probable future economic benefit that a firm controls because of a past event or transaction 
A. asset
B. liability
C. shareholders’ equity
D. revenue
E. expense


37. The criteria for asset recognition include 
A. The firm owns or controls the right to use the item.
B. The right to use the item arises as a result of a past transaction or exchange.
C. The future benefit has a relevant measurement attribute that can be quantified with sufficient reliability.
D. all of the above
E. none of the above


38. Which of the following are true? 
A. not all future benefits qualify as assets
B. all assets provide future benefits
C. not all future benefits are assets.
D. all of the above
E. none of the above


39. Which of the following is true regarding the “reliability” of a reported amount? 
A. that the amount corresponds to what it purports to represent
B. is reasonably free from error and bias in the sense that multiple independent measurers would agree on the amount.
C. neither U.S. GAAP nor IFRS specifies what amount of reliability is “sufficient,” suggesting that this judgment is context-specific and subjective, not quantifiable.
D. all of the above
E. none of the above


40. The _____ of an asset is the amount a firm would have to pay to obtain another asset with identical service potential; it is an entry value that reflects economic conditions at the measurement date. 
A. Current Replacement Cost
B. Net Realizable Value
C. Fair Value
D. Present Value of Future Net Cash Flows.
E. Acquisition cost



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