User Account

All Pages

Describe briefly the following characteristics

Assignment Help Accounting Basics
Reference no: EM131103521

1. (Qualitative Characteristics) Accounting information provides useful information about business transactions and events. Those who provide and use financial reports must often select and evaluate accounting alternatives. FASB Statement of Financial Accounting Concepts No. 2, "Qualitative Characteristics of Accounting Information," examines the characteristics of accounting information that make it useful for decision making. It also points out that various limitations inherent in the measurement and reporting process may necessitate trade-offs or sacrifices among the characteristics of useful information. 

(a) Describe briefly the following characteristics of useful accounting information.

(1) Relevance 
(2) Reliability 
(3) Understandability
(4) Comparability
(5) Consistency

(b) For each of the following pairs of information characteristics, give an example of a situation in which one of the characteristics may be sacrificed in return for a gain in the other.

(1) Relevance and reliability. 
(2) Relevance and consistency. 
(3) Comparability and consistency.
(4) Relevance and understandability.
(c) What criterion should be used to evaluate trade-offs between information characteristics? 

Reference no: EM131103521

Questions Cloud

Discuss the factors to be considered in determining : Discuss the factors to be considered in determining when revenue should be recognized for the purpose of accounting measurement of periodic income.
The publication of the magazine every month : Both events, by recognizing a portion of the revenue with cash sale of the magazine subscription and a portion of the revenue with the publication of the magazine every month.
Prepare a cash budget for december, january, and february : The estimated sales and purchases for December, January, and February are shown below. Purchases during November amounted to $140,000.a. Prepare a cash budget for December, January, and February.b. Now, suppose Koehl were to start selling on a credit..
The expected return on equity under each current asset level : What is the expected return on equity under each current asset level? (Assume a 40 percent effective federal-plus-state tax rate.) b. In this problem, we have assumed that the level of expected sales is independent of current asset policy. Is this a ..
Describe briefly the following characteristics : Describe briefly the following characteristics of useful accounting information.
Calculate christie''s cash conversion cycle : Calculate Christie's cash conversion cycle. Assuming Christie holds negligible amounts of cash and marketable securities, calculate its total assets turnover and ROA. Suppose Christie's managers believe that the inventory turnover can be raised to 7...
What is the length of the firm''s cash conversion cycle : The Zocco Corporation has an inventory conversion period of 75 days, a receivables collection period of 38 days, and a payables deferral period of 30 days.a. What is the length of the firm's cash conversion cycle?
What is the effective annual interest of trade credit : The D.J. Masson Corporation needs to raise $500,000 for 1 year to supply working capital to a new store. Masson buys from its suppliers on terms of 3/10, net 90, and it currently pays on the 10th day and takes discounts, but it could forgo discounts,..
What is the minimum on-resistance that can be achieved : what is the minimum on-resistance that can be achieved with W/L = 20?

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd