ch02_Selected_EOC_Solutions_K_12e

Ch02_Selected_EOC_So - ConceptualFramework (BYTOPIC Topics 1 2 3 4 5 6 Conceptualframework general reporting accounting.

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
CHAPTER 2 Kieso 12e Edit for Class Site Conceptual Framework Underlying Financial Accounting ASSIGNMENT CLASSIFICATION TABLE (BY TOPIC) Topics Questions Brief Exercises Exercises Concepts for Analysis 1. Conceptual framework– general. 1, 21 1, 2 2. Objectives of financial reporting. 2, 5 3 3. Qualitative characteristics of accounting. 3, 4, 6, 24 1, 2 1, 2 4 4. Elements of financial statements. 7, 8, 9 3, 9, 10 3 5. Basic assumptions. 10, 11, 12 4 4, 5 6. Basic principles: a. Historical cost. b. Revenue recognition. c. Expense matching. d. Full disclosure. 13, 14, 15 16, 17, 18 19 20, 21, 22 5 4, 5 5 4, 5 4, 5, 6 5, 6 5, 6, 7, 8, 9, 10, 11 7. Accounting principles– comprehensive. 7, 8 8. Constraints. 23, 24, 25, 26 6, 7 1 12 9. Comprehensive assign- ments on assumptions, principles, and constraints. 8 4, 5 2-1
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
ANSWERS TO QUESTIONS KWW 12e Ch 2 1. A conceptual framework is a coherent system of interrelated objectives and fundamentals that can lead to consistent standards and that prescribes the nature, function, and limits of financial accounting and financial statements. A conceptual framework is necessary in financial accounting for the following reasons: 1. It will enable the FASB to issue more useful and consistent standards in the future. 2. New issues will be more quickly soluble by reference to an existing framework of basic theory. 3. It will increase financial statement users understanding of and confidence in financial reporting. 4. It will enhance comparability among companies financial statements. 2. The primary objectives of financial reporting are as follows: 1. Provide information useful in investment and credit decisions for individuals who have a reasonable understanding of business. 2. Provide information useful in assessing future cash flows. 3. Provide information about enterprise resources, claims to these resources, and changes in them. 3. Qualitative characteristics of accounting information are those characteristics which contribute to the quality or value of the information. The overriding qualitative characteristic of accounting information is usefulness for decision making. 4. Relevance and reliability are the two primary qualities of useful accounting information. For informa-tion to be relevant, it should have predictive value or feedback value, and it must be presented on a timely basis. Relevant information has a bearing on a decision and is capable of making a difference in the decision. Relevant information helps users to make predictions about the outcomes of past, present, and future events, or to confirm or correct prior expectations. Reliable information can be depended upon to represent the conditions and events that it is intended to represent. Reliability stems from representational faithfulness, neutrality, and verifiability.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/25/2008 for the course AC 347 taught by Professor Wu during the Fall '08 term at BU.

Page1 / 23

Ch02_Selected_EOC_So - ConceptualFramework (BYTOPIC Topics 1 2 3 4 5 6 Conceptualframework general reporting accounting.

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online