Developing Accounting Information in Conformity with Generally Accepted Accounting Principles

question 323

Multiple Choice

Developing accounting information in conformity with generally accepted accounting principles is called financial accounting, because this information is designed to summarize the financial position and operating results of a business entity. Financial accounting concepts apply to all types and sizes of business organizations. These concepts are useful to decision makers in both business and government in evaluating a wide range of economic issues. Walter B. Meigs and Robert F. Meigs, Accounting, 6^th ed.

• A) Nonargument.
• B) Argument, conclusion: Financial accounting concepts ... business organizations.
• C) Argument, conclusion: These concepts are useful ... economic issues.
• D) Argument, conclusion: Developing accounting ... financial accounting.
• E) Argument, conclusion: This information is designed ... business entity.

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Definitions:

Rate of Return

The profit or deficit experienced on an investment during a particular timeframe, represented as a proportion of the investment's initial expense.

Templeton Growth Fund

A mutual fund that aims for long-term capital growth by investing primarily in the equity of companies around the world.

Invested

Money that is allocated for a particular purpose, such as buying stocks or bonds, in the hope of generating a financial return.

Strip Bond

A type of bond where the principal and regular coupon payments have been separated and are sold individually.