AC300-Unit2ExcelTemplate - C1-9 GAAP HierarchyA friend of...

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Unformatted text preview: C1-9 GAAP HierarchyA friend of yours says, I understand there are rules forfinancial reporting. But what are these rules, where can a personfind them, and which ones are more important?RequiredPrepare an answer for your friend.C1-9 GAAP HierarchyName:Pamela BatesAn asterisk (*) will appear next to an incorrect amount(s) in the outlined cell(s). If you are still gettinga red asterisk, and think the answer is correct, but used a formula in the cell try manually typingin the answer according to the rounding instructions.RequiredPrepare an answer for your friend.The U.S. GAAP is a set of required guidelines, procedures andpractices in financial reporting. FASB is a policy makingcommittee that approves accounting standards. The basicprinciples are to: reduce time and effort to solve an accountingissue, reference accounting literature to reduce chances of error in compliance, and provide updates as new standards are issued. These rules can be found by visiting FASB accounting standards codification. All rules are equally important and knowing which rule to apply to an individual situation is key; however each category is listed by order of importance. Category A is most important because these are GAAP sources. Category B-D is used in reference to identify GAAP.C1-9 GAAP HierarchyName:SolutionsAn asterisk (*) will appear next to an incorrect amount(s) in the outlined cell(s). If you are still gettinga red asterisk, and think the answer is correct, but used a formula in the cell try manually typingin the answer according to the rounding instructions.RequiredPrepare an answer for your friend.Type your response in the green box provided below.The following is a "hierarchy" of four categories of GAAP and the authoritative sources applicable to each category for companies:CategoriesAuthoritative Sources (Pronouncements)ABCDThe "rules" for financial accounting are called generally accepted accounting principles. Generally accepted accounting principles (GAAP) are the guidelines, procedures, and practices that a company is required to use in recording and reporting the accounting information in its audited financial statements. GAAP define accepted accounting practices at a particular time and provide a standard by which to report financial results. They are like laws that must be followed in financial reporting.There are several accounting policy-making bodies that have established GAAP, including the Financial Accounting Standards Board (FASB), Accounting Principles Board (APB), American Institute of Certified Public Accountants (AICPA), and Securities and Exchange Commission (SEC). Currently, there is no single document that includes all the accounting standards. However, the FASB has released its FASB Accounting Standards Codification for verification by its constituents. When that includes all the accounting standards....
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This note was uploaded on 07/10/2011 for the course ACCOUNTING 116 - 301 taught by Professor Levine during the Spring '11 term at Kaplan University.

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AC300-Unit2ExcelTemplate - C1-9 GAAP HierarchyA friend of...

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