Conceptual Framework Terminology
Match the numbered statements below with the lettered terms. An answer (letter) may be used more than once, and some terms require more than one answer (letter).
1. Key ingredients in quality of relevance.
2. Traditional assumptions that influence the FASB’s conceptual framework.
3. The idea that information should represent what it purports to represent.
4. An important constraint relating to costs and benefits.
5. An example of conservatism.
6. The availability of information when it is needed.
7. Recording an item in the accounting records.
8. Determines the threshold for recognition.
9. Implies consensus.
10. Transactions between independent parties.
(a) Cost effectiveness
(b) Representational faithfulness
(c) Recognition
(d) Verifiability
(e) Time periods
(f) Unrealized
(g) Completeness
(h) Timeliness
(i) Materiality
(j) Predictive value
(k) Economic entity
(l) Lower of cost or market rule
(m) Phrenology
(n) Arm’s length transactions