Exam 2: Financial Reporting Theory

What is the term that describes the building blocks of the financial statements?

U.S.GAAP identifies ________ point-in-time elements.

IFRS identifies ________ point-in-time elements.

Information exhibits the characteristic of faithful representation if it is complete,neutral,and free from error.

Who are the primary users of financial information? Discuss how FASB and IASB take them into account.

Publicly traded U.S.companies are required to comply with IFRS.

When the buyer and seller are unrelated and independent,the transaction is considered to be ________.

Angelo's charges $200 per month for catering services.In the first quarter of the year,they collected $14,000.Fifteen customers pre-paid for three months of catering beginning in January,ten customers pre-paid for two months of catering beginning in February,and five customers paid for one month of catering in March.Using the cash basis of accounting,Angelo's will recognize ________ in revenue for February and ________ using the accrual basis.

Which of the following statements is not true about distributions to owners?

The ________ cost is the amount of cash (or equivalent)that a firm paid to acquire an asset,whereas ________ is the amount the firm would pay if the asset were purchased today.

A key relationship among the conceptual framework components is the direct effect of financial reporting standards on the elements of the financial statement.

What is the relationship between the point-in-time elements and the period-of-time elements?

The most important characteristic of accounting information is whether it is ________.

Which of the following is not an underlying assumption in financial reporting?

Comprehensive income is the residual interest in the assets of an entity that remains after deducting its liabilities.

Which of the following terms describe probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events?

What are the attributes of relevant information?

The conceptual framework defines the objective of financial reporting as providing financial information that is useful in making decisions about resource allocation.

________ are restatements or revaluations of reported amounts of assets and liabilities that companies usually report in comprehensive income.

A key relationship among the conceptual framework components is the impact the objective of financial reporting has on the qualitative characteristics that are considered to make accounting information useful.