Acct-303 Chapter 1

Front 1

Accounting standards and interpretations are issued by the:

Back 1

FASB

Front 2

What is the purpose of information presented in notes to the financial statements?

Back 2

To provide disclosure required by generally accepted accounting principles

Front 3

What provides the best indication of an enterprise's present and continuing ability to generate favorable cash flows?

Back 3

Accrual basis accounting

Front 4

Who are the 4 parties involved in standard setting?

Back 4

1. SEC (govt. organization)
2. FASB (non-govt.)
3. AICPA (private organization)
4. GASB

Front 5

International accounting standards are established by the:

Back 5

IASB

Front 6

An effective process of capital allocation is critical to a healthy economy, which does what 3 things?

Back 6

a) Promotes productivity
b) Encourages innovation
c) Provides an efficient and liquid market for buying and selling securities

Front 7

A non-government organization that is responsible for issuing financial accounting standards for business organizations:

Back 7

FASB

Front 8

All of the following are objectives of financial reporting except to provide information

a) About enterprise resources, claims to those resources, and changes in them.
b) That is useful in investment and credit decisions.
c) About the management and major shareholders of an enterprise.
d) That is useful in assessing cash flow prospects.

Back 8

c) About the management and major shareholders of an enterprise

Front 9

What organization requires public companies to adhere to GAAP?

Back 9

SEC

Front 10

What are the 3 types of pronouncements issued by the FASB?

Back 10

1) Standards, Interpretations, and Staff Positions
2) Financial Accounting Concepts
3) Emerging Issues Task Force Statements

Front 11

Organization established by federal government that performs accounting and reporting for public companies:

Back 11

SEC

Front 12

Which accounting pronouncement is the most authoritative?

Back 12

AICPA Accounting Principles Board Opinion

Front 13

Financial Accounting Standards Board that consults companies on major policy issues:

Back 13

Financial Accounting Standards Advisory Council

Front 14

A national professional organization that established the 'Committee on Accounting Procedures' and the 'Accounting Principles Board':

Back 14

AICPA

Front 15

TRUE/FALSE:

All those who serve on the FASB must be Certified Public Accountants.

Back 15

False

Front 16

What are the 2 sets of accounting standards accepted for international use?

Back 16

1) U.S. GAAP, issued by the FASB

2) International Financial Reporting Standards (IFRS), issued by the IASB

Front 17

What are 3 common issues faced in financial reporting?

Back 17

1) Expectation gap
2) International accounting standards
3) Ethics