The Conceptual Framework Does NOT Include

question 51

Multiple Choice

The conceptual framework does NOT include

• A) the objective of financial reporting.
• B) elements of financial statements.
• C) recognition and measurement criteria.
• D) specific standards to be followed in preparing financial statements.

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Definitions:

Expense Recognition Principle

An accounting guideline stating that expenses should be recorded in the same period as the revenues they help to generate.

Direct Write-off Method

An accounting method for uncollectible receivables where the specific account's balance is directly removed from accounts receivable.

Allowance Method

A technique in accounting used to adjust accounts receivable for the amount estimated to be uncollectible.

Bad Debts

Accounts receivable that are considered uncollectible, representing losses to the company.