Which of the Following Is a Value Judgment Found in SFAC

question 26

Multiple Choice

Which of the following is a value judgment found in SFAC No. 1?

• A)Accounting reports should become the only relevant source of information about enterprises.
• B)Cash basis accounting is extremely useful in assessing and predicting earning power and cash flows of an enterprise.
• C)Information is not costless to provide, so benefits of usage should exceed costs of production.
• D)Users of accounting information have limited ability regarding financial information and reporting.

---

Definitions:

Negotiability

The characteristic of a document, typically a financial instrument, that allows it to be transferred or assigned from one party to another as a form of payment or investment.

Japanese Yen

The official currency of Japan, represented by the symbol ¥.

Subject to

Conditioned upon or dependent on a certain event or provision, often indicating the existence of specific limitations or requirements.

Negotiable Instruments

Financial instruments that guarantee the payment of a specified amount of money, either on demand or at a set time, with the feature of being transferable from one party to another.