Chase_6615_ch2 - given period. Distributions to owners-...

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Andrew Chase Intermediate Accounting Chapter 2 2-3. The term “qualitative characteristics of quality accounting information” means providing information that is most useful for decision making. The two primary qualities are relevance and reliability. The two secondary qualities are comparability and consistency. 2-4. Relevance- Information that is capable of making a difference in a decision. This information is important because it helps us predict the outcome of past, present, and future events. Reliability- Information that is verifiable, is a faithful representation, and is reasonably free of error or bias. This is important because users do not have the time or expertise to evaluate the factual content of the information. 2-8. Expenses- Decrease of assets or incurrence of liabilities that go along with necessary operations of a company. Losses- Decrease in equity from events that are peripheral or incidental during a
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Unformatted text preview: given period. Distributions to owners- Decrease of net assets that go to directly to owners in exchange for their owner interests (or equity) in an enterprise. 2-9. Revenues- Increase of assets by providing goods or services. Gains- Increase of assets through transactions during a given period. Investments by owners- Increase of assets directly from owners in exchange for interests in a company. E2-3. Assets- (f) Liabilities- (b) Equity- (i) Investment by owners- (c) Distributions to owners- (k) Comprehensive income- (l) (e) Revenues- (j) Expenses- (h) Gains- (g) (a) Losses- (a) E2-4. Economic entity assumption- (f) Going concern assumption- (d) Monetary unit assumption- (j) Periodicity assumption- (g) Historical cost principal- (b) Matching principle- (a) Full disclosure principle- (c) Cost-benefit relationship- (e) Materiality- (i) Industry Practices- (h) Conservatism- (f)...
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This note was uploaded on 12/07/2009 for the course ACCT 5521 taught by Professor Englese during the Spring '08 term at Fairleigh Dickinson.

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Chase_6615_ch2 - given period. Distributions to owners-...

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