CFAS Chapter 2 Problem 2

1. The conceptual framework may be revised from time to time. Revisions in the conceptual
framework automatically result in changes in the standards. False
2. According to the revised conceptual framework, the asset is the right, while the liability is
the obligation, rather than the ultimate inflows or outflows of economic benefits resulting
from the asset or liability. True
3. Legal enforceable of a right, for example, ownership, is necessary for control over an
economic resource to exist. False
4. According to the revised conceptual framework, an asset can exist even if the probability
that it will provide inflows of future economic benefits is low, and even if the asset is subject
to high measurement uncertainty. True
5. According to the revised conceptual framework, what the entity controls are the right and
not the ultimate inflows of future economic benefits that the economic resource may
produce. True
6. The conceptual framework defines income and expenses in terms of changes in assets and
liabilities. True
7. Not all items that meet the definition of a financial statement element are recognized; they
are recognized only if recognizing them will also result in relevant and faithfully represented
information. True
8. Measuring an asset at historical cost will always result in the same carrying amount of the
asset from period to period. False
9. According to the conceptual framework, amortized cost measurement relates to historical
cost, rather than current value. True
10. Although the use of a single measurement basis improves the understandability of the
financial statements, this may not always lead to useful information. Thus, the standards
require different measurement bases for different assets, liabilities, income, and expenses.
true