What is consistency, Accounting Basics

Assignment Help:

Q. What is Consistency?

Consistency in general requires that a company use the same accounting principles and reporting practices through time. This concept disallows indiscriminate switching of accounting principles or methods such as changing inventory methods every year. But consistency doesn't prohibit a change in accounting principles if the information needs of financial statement users are better served by the change. When a company makes a alter in accounting principles it must make the following disclosures in the financial statements (a) nature of the change (b) reasons for the change (c) effect of the change on current net income, if significant and (d) cumulative effect of the change on past income.


Related Discussions:- What is consistency

Explain in brief the inventory carrying costs, Question 1: What are the...

Question 1: What are the kinds of inventory? Transaction inventory Speculative inventory Precautionary inventory Question 2: Explain in brief the invent

Create a balance sheet and manage accounting entries, Two companies enter ...

Two companies enter into loan agreements on 1 March 2012. On that date they also enter into an agreement to swap the loans. The details for each company and loan are: L R R Hood

Bookkeeping, Under both GAAP and tax depreciation, an asset cannot be depre...

Under both GAAP and tax depreciation, an asset cannot be depreciation until it has been

Define auditing, Q. Define Auditing? Auditing A business in quest of a ...

Q. Define Auditing? Auditing A business in quest of a loan or attempting to have its securities traded on a stock exchange typically must provide financial statements to suppor

Explain about predictive value and feedback value, Q. Explain about Predict...

Q. Explain about Predictive value and feedback value? Several suggest using a different valuation basis such as current cost in reporting such assets. Predictive value and feed

The following unadjusted trial balance is prepared at fisca, The following ...

The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial Balance January 31, 2013 Debit Credit Cash $

The qualitative characteristics of relevance and reliability, Maryanne was ...

Maryanne was looking to purchase a local business that sold coal jewelry to tourists along the interstate. The present business owner instructed his accountant, Jane Sane, CPA, to

Describe about borrowed money, Q. Describe about Borrowed money? The co...

Q. Describe about Borrowed money? The company lent USD 6000 from Chaney's father. Chaney signs the note for the company. The note turn off no interest and the company promised

Selling a device, Assume we are selling a device for 6000 and the company n...

Assume we are selling a device for 6000 and the company need to replace that device with a new device which is a bit more than the prior price say 7000.Then,how we can account this

Write Your Message!

Captcha
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!

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