1. Research that relies on observing actual phenomena or data is known as:

 

a. 

descriptive research.

 

b. 

empirical research.

 

c. 

deductive research.

 

d. 

inductive research.

 

ANSWER:  

b

 

2. Which of the following statements relating to the importance of studying accounting theory is incorrect?

 

a. 

Accounting plays a very important and pervasive role in society.

 

b. 

Many significant decisions are made on the basis of information provided by accountants.

 

c. 

High profile corporate failures have substantially increased the level of trust placed on accountants by people in society.

 

d. 

Accounting can be considered both a technical and social practice.

 

ANSWER:  

c

 

3. Using logic rather than observation to explain a set of facts describes:

 

a. 

deductive reasoning.

 

b. 

inductive reasoning.

 

c. 

empirical reasoning.

 

d. 

prescriptive reasoning.

 

ANSWER:  

a

 

test bank for Financial Accounting Theory 5th Edition by Craig Deegan