Question

In: Accounting

Which of the following statement regarding the limitations of the statement of financial position is incorrect.


Which of the following statement regarding the limitations of the statement of financial position is incorrect. 

  • All assets and liabilities are reported at fair value. 

  • Many items that are of financial value are omitted. 

  • Judgments are used in the valuation of many items. 

  • Estimates are used in the valuation of many items.

Solutions

Expert Solution

Option A------all assets and liabilities are reported at fair value

above statement is incorrect , since Under statement of financial position, assets and liabilities are reported at historical value i.e cost at which it was acquired. for eg--- Fixed assets are recorded at historical cost

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

4. Which of the following are limitations of an entity’s Statement of Financial Position? I. The...
4. Which of the following are limitations of an entity’s Statement of Financial Position? I. The Statement of Financial Position prepared at the end of the financial period may not be representative of the financial position at other times during the financial period. II. The Statement of Financial Position may not include all items that create value for the entity. III. The Statement of Financial Position is a historical representation of an entity’s financial position and does not consider the...
4. Which of the following are limitations of an entity’s Statement of Financial Position? I. The...
4. Which of the following are limitations of an entity’s Statement of Financial Position? I. The Statement of Financial Position prepared at the end of the financial period may not be representative of the financial position at other times during the financial period. II. The Statement of Financial Position may not include all items that create value for the entity. III. The Statement of Financial Position is a historical representation of an entity’s financial position and does not consider the...
1.1 Which of the following statements regarding The Statement of Financial Position is true? A The...
1.1 Which of the following statements regarding The Statement of Financial Position is true? A The Statement of Financial Position reflects the financial position of an enterprise for the entire financial period being reported. B The Statement of Financial Position reflects the financial position of an enterprise only on a specific date C The Statement of Financial Position is a measure of the profit or loss that the enterprise has made over a certain period, usually one year D The...
Explain the statement of financial position and its uses and limitations
Explain the statement of financial position and its uses and limitations
discuss the uses and limitations of the statement of financial position for decision making
discuss the uses and limitations of the statement of financial position for decision making
15. Which of the following statement regarding t and z distributions is incorrect ___________? a. z...
15. Which of the following statement regarding t and z distributions is incorrect ___________? a. z distribution is also called standardized normal distribution b. z critical values are determined by the z distribution and the alpha level c. t distribution is a family of distribution, one for each degrees of freedom d. t critical values are determined by the t distribution and the alpha level 16. When n is small (less than 30), the t distribution ______. a.         is almost identical...
Which is an INCORRECT statement regarding the following cross-tabulation table about gender and diagnosis of 20...
Which is an INCORRECT statement regarding the following cross-tabulation table about gender and diagnosis of 20 participants of study A? Female Male Total Depression Only 2 2 4 16.6% 25% 20% Anxiety Only 6 6 12 50% 75% 60% Depression & Anxiety 4 0 4 33.3% 0% 20% Total 12 8 20 Group of answer choices Approx. 16.6% of the female participants have depression only. Among the participants who have anxiety only, 75% are male. There are 12 participants who...
Which of the following statements is INCORRECT regarding Master Budget?
Which of the following statements is INCORRECT regarding Master Budget? 1 Master budget is one type of operational budget 2. Master budget is focusing specific volume of business activity that is expected. 3 Budgeted balance sheet should be prepared before budgeted income statement. 4. Master budget starts from preparing sales budget.
17. Which of the following would appear on the statement of financial position as a current...
17. Which of the following would appear on the statement of financial position as a current liability? a. a probable loss in the amount of $4 million from an ongoing lawsuit b. a possible loss in the amount of $4 million from an ongoing lawsuit c. a probable loss from an ongoing lawsuit, the amount of which is not yet determinable d. a lawsuit for $4 million for which the likelihood of loss is remote 18. Chastain Park Entertainment paid...
Which statement regarding investments in equity securities is​ incorrect? A. Investments in equity securities are classified...
Which statement regarding investments in equity securities is​ incorrect? A. Investments in equity securities are classified into three specific types based on the​ investor's level of influence over the investee company. B. ​Generally, no significant influence exists if there is an ownership interest of less than​ 20% of the​ investee's voting stock. C. Significant influence equity investments are consolidated into the​ investor's financial statements. D. Significant influence equity investments are always reported as​ long-term assets on the balance sheet.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT