Which of the Following Is Not a Component of the Conceptual

question 14

Multiple Choice

Which of the following is not a component of the Conceptual Framework for Financial Reporting?

• A)Objective of general purpose financial statements
• B)Presentation and disclosure
• C)Legitimacy and rationality
• D)Recognition and measurement

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Definitions:

Net Present Value

The calculation used to determine the present value of all cash flows associated with a project or investment, including initial capital outlay and all subsequent flows, discounted at a particular rate.

Electricity Bills

A periodic payment made by consumers for the electricity that they have consumed during a billing cycle.

Interest Rate

The percentage of the principal amount charged by lenders to borrowers for the use of money.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time.