Basic Accounting Theory

Question 1

The Relevance of providing information in the Financial Statements is subject to the constraint of

Answer 1

Cost Benefit

Question 2

The Concept of Reliability is?

Answer 2

No Longer part of the conceptual Framework

Question 3

What Account would cause earnings to differ from Comprehensive Income?

Answer 3

Unrealized gain/loss on AFS Securities

Question 4

Comprehensive Income excludes changes from equity that happens in what account?

Answer 4

Dividend Paid to Stockholders

Question 5

What is the realization concept?

Answer 5

Converting Non-Cash Rights/rights into cash via sale of assets for Cash or cash claims

Ex - Sale of Depreciated cash for Note Receivable

Question 6

What Capital maintenance concept is applied to Net Income and Comprehensive Income?

Answer 6

Financial Capital