Chapter 01 Student: ___________________________________________________________________________ 1. Which of the following is true about theories in general? A. Theories can include any coherent set of ideas or statements to explain, or provide guidance in respect of, certain phenomena. B. Theories must be empirically based to describe what is, rather than what should be. C. Theories must be based on inductive reasoning to provide a generalisation or prediction. D. All of the given options are correct. 2. According to Thouless (1974), the 'tricks' some writers often use to distract readers from limitations in the logic of an argument or theory are: A. Using emotionally-toned words B. Evasion of a sound refutation of an argument by use of a sophisticated formula C. Changing the meaning of a term during the course of an argument D. All of the given options are correct. 3. Normative accounting theories and research seek to: A. Explain and predict particular phenomena based on observation B. Prescribe particular approaches not driven by existing practices C. Describe what is normal, or generally accepted, practice D. All of the given options are correct. 4. A theory that predicts that, if certain conditions are met then particular accounting practices will be observed, is an example of: A. Positive Accounting Theory B. Negative Accounting Theory C. Normative Accounting Theory