True / False Questions 1. Accounting is a system that collects and processes financial information about an organization and reports that information to decision makers. TRUE AACSB Tag: Communications Difficulty: Easy L.O.: 1 2. Assets on the balance sheet are recorded at market value or replacement cost. FALSE AACSB Tag: Reflective Thinking Difficulty: Easy L.O.: 1 3. In accounting and reporting for a business entity‚ the accounting and reporting for the
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EXERCISES 2.1 Instructions Select the assumption‚ principle‚ or constraint that most appropriately justifies these procedures and practices. (Do not use qualitative characteristics.) (a) Market value changes are not recognized in the accounting records. (b) Lower of cost or market is used to value inventories. (c) Financial information is presented so that investors will not be misled. (d) Intangible assets are capitalized and amortized over periods benefited. (e) Repair tools are expensed
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and other markets by promoting the efficient and equitable allocation of scarce resources in the economy. Each of the primary leaders of accounting standards‚ the International Accounting Standard Board (IASB) and Financial Accounting Standard Board (FASB)‚ developed its conceptual framework for financial reporting‚ which is a coherent system of concepts that flow from an objective. The objective identifies the purpose of financial reporting. The concepts provide guidance for identifying the boundaries
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Explaining Basic Accounting Concepts and Business Structures Laurie D. Melvin ACC/537 – Financial Accounting May 9‚ 2011 James Neuner‚ MBA One of the most important decisions to make when one chooses to start a business is knowing the type of legal organizations to select because the decision affects many aspects of the business. What can be affected are the amount and type of paperwork required‚ tax payments‚ possible personal liability
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its businesses building on its brands. They also want to be the most attractive employer in the branch and the first choice for its stakeholders. Discussion (Caribou Coffee Company) As of June 2011‚ the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-06‚ Comprehensive Income (Topic 820). This accounting standard update eliminates the option to present components of other comprehensive income as part of the statement of equity and requires the total
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Concepts a. (i.) According to FASB Statement of Concepts No. 6‚ paragraph 25‚ assets are probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events. They represent probable future economic benefits controlled by the enterprise. According to FASB Statement of Concepts No 6‚ paragraph 80‚ expenses are outflows or other using up of assets or incurrences of liabilities (or a combination of both) during a period from delivering or producing
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consolidated. The notes were very informative for the reader and helped to clarify where the figures came from. Reference Financial Accounting Standards Board (FASB). (2008). Summary of Statement No. 132 (revised 2003) Employers’ Disclosures about Pensions and Other Postretirement Benefits—an amendment of FASB Statements No. 87‚ 88‚ and 106 (Issued 12/03. Retrieved Saturday‚ September 13‚ 2008 from
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Generally Accepted Accounting Principles Generally accepted accounting principles is a set of broad guidelines‚ rules‚ and requirements followed by financial preparers’ used in preparing an organization’s financial statements‚ (Cleverley‚ Song‚ & Cleverley‚ 2011). Health care organizations financial statements are the key tools in presenting and projecting current and future economic viability‚ (Finkler‚ Kovner‚ & Jones‚ 2007). The financial prepared by organization’s are as follows:
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Flat Cargo Berhad (FCB) Introduction FCB obtained listing in Bursa Malaysia on the 15 September 2001. The main core business was to provide air freight transportation within the Asian region. As a fast growing company‚ FCB secured agreements from well-establish company within the transportation industry such as Worldwide Express‚ United Parcel Services (UPS)‚ Nationwide Express‚ City link and others. Issue on FCB 1) The auditors were unable to verify the aircrafts claimed have been purchased
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essentially completed. LabCo will have to adopt the cost recovery method of revenue recognition for the Halibut contract as well as other instances where total costs cannot be reliably estimated if they wish to follow IFRS in the future. Currently FASB and IFRS are working on a new comprehensive approach to revenue recognition. The new standard will likely be controversial as some practices would change considerably such as the percentage-of-completion method not being allowed unless the customer
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