Free T7 Exam Braindumps (page: 8)

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When a company provides information that is of sufficient importance to influence the judgment and decisions of an informed user, which principle of Level 3 of the conceptual framework is being represented?

  1. Faithful representation
  2. Measurement
  3. Full disclosure
  4. Going concern

Answer(s): C



Which of the following is true of liabilities?

  1. Current liabilities come due in less than a year
  2. Current liabilities come due in less than 18 months
  3. Noncurrent liabilities come due in less than a year
  4. Both current and noncurrent liabilities come due in less than a year

Answer(s): A



Company XYZ does not disclose any information in the notes to their financial statements unless the value of the information to users exceeds the expense of gathering it. Which constraint of Level 3 of the conceptual framework does this represent?

  1. Cost
  2. Materiality
  3. Expense
  4. Disclosure

Answer(s): A



Which of the following is the best description of liquidity?

  1. The historical cost of an asset
  2. The fair value of an asset
  3. The ease of converting a noncash asset to cash
  4. Liabilities, minus equity

Answer(s): C






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