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Unformatted text preview: CHAPTER 1 Kieso 12e Edit for Class Site Financial Accounting and Accounting Standards ASSIGNMENT CLASSIFICATION TABLE Topics Questions Cases 1. Subject matter of accounting. 1 1 2. Environment of accounting. 2, 3, 4 3, 4 3. Role of principles, objectives, standards, and accounting theory. 5, 6, 7 2 4. Historical development of accounting standards. 8, 9, 10, 11 5, 16 5. Authoritative pronouncements and standards-setting bodies. 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23 6, 7, 8, 9, 10, 11, 12, 15 6. Role of pressure groups. 23, 24, 25, 26, 27, 28 17, 18 7. International accounting. 29, 30 14 8. Ethical issues. 31 13, 16 1-1 ANSWERS TO QUESTIONS Ch 1 1. Financial accounting measures, classifies, and summarizes in report form those activities and that information which relate to the enterprise as a whole for use by parties both internal and external to a business enterprise. Managerial accounting also measures, classifies, and summarizes in report form enterprise activities, but the communication is for the use of internal, managerial parties, and relates more to subsystems of the entity. Managerial accounting is management decision oriented and directed more toward product line, division, and profit center reporting. 2. Financial statements generally refer to the four basic financial statements: balance sheet, income statement, statement of cash flows, and statement of changes in owners or stockholders equity. Financial reporting is a broader concept; it includes the basic financial statements and any other means of communicating financial and economic data to interested external parties. Examples of financial reporting other than financial reports are annual reports, prospectuses, reports filed with the government, news releases, management forecasts or plans, and descriptions of an enterprise s social or environmental impact. 3. If a company s financial performance is measured accurately, fairly, and on a timely basis, the right managers and companies are able to attract investment capital. To provide unreliable and irrelevant information leads to poor capital allocation which adversely affects the securities market. 4. Some major challenges facing the accounting profession relate to the following items: Non-financial measurement how to report significant key performance measurements such as customer satisfaction indexes, backlog information and reject rates on goods purchased. Forward-looking information how to report more future oriented information. Soft assets how to report on intangible assets, such as market know-how, market dominance, and well- trained employees. Timeliness how to report more real-time information....
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This note was uploaded on 09/25/2008 for the course AC 347 taught by Professor Wu during the Fall '08 term at BU.
- Fall '08