Introduction to financial accounting 11th edition horngren test bank

11) For each example, write the qualitative characteristic(s) or accounting term that best corresponds. a. A company that uses a different inventory method every year is not following this characteristic of financial information. b. An error of $100 of revenue for Sherry's Dairy King versus $100 of revenue for McDonald's. c. Record revenue when it is earned and record expenses when incurred regardless of when cash changes hands. d. A parent corporation, a subsidiary, and a retail store are examples of this concept. e. The SEC requires companies with publicly traded securities to file financial reports with the SEC quarterly. f. Three auditors count the same amount of cash.

Answer: a. consistency b. materiality c. accrual accounting d. entity e. periodicity f. verifiability Diff: 2 Objective: L.O. 2-7 & 2-8