Intermediate accounting solutions
The important concept here is that the incurrence of the cost has resulted in the acquisition of an asset, a future service potential. CA Time 30—35 minutes Purpose—to provide the student with some familiarity with the Conceptual Framework.
Intermediate accounting solutions
Not only should the incurrence of the cost result in the acquisition of an asset from which future benefits are expected, but also the cost should be measurable with a reasonable degree of objectivity, and there should be reasonable grounds for associating it with the asset acquired. It should be emphasized that it is not a violation of the measurement principle historical cost principle to use the fair value of the stock. False — An implicit assumption is that users need reasonable knowledge of business and financial accounting matters to understand the information contained in the financial statements. Closely related to predictive value is confirmatory value. The suggestions below are intended to serve as examples. Relevant information is capable of making a difference in a decision. Our policy is to recognize revenue when title to the product, ownership and risk of loss transfer to the customer, which can be on the date of shipment or the date of receipt by the customer. However, knowledge of the objectives and concepts the Board uses should enable all who are affected by or interested in financial accounting standards to better understand the content and limitations of information provided by financial accounting and reporting, thereby furthering their ability to use that information effectively and enhancing confidence in financial accounting and reporting. This occurs when the product is delivered, which is the case when the magazines are delivered to customers each month.
It should further be noted that the revenue recognition principle provides the answer to when revenue should be recognized. Acceptance of this assumption provides credibility to the measurement principle historical cost principle, which would be of limited usefulness if liquidation were assumed.
Hence, it is misleading to deviate from the measurement principle historical cost principle because conjecture or opinion can take place. These sample display houses are assets because they represent rights to future service potentials or economic benefits.
It should also be noted that the revenue recognition principle states that revenue should not be recognized until a performance obligation is satisfied. Applying the expense recognition principle will result in lower profits and possibly higher rates for consumers.
Wileyplus intermediate accounting chapter 1 solutions
Faithful representation means that numbers and descriptions match what really existed or happened. It should further be noted that the revenue recognition principle provides the answer to when revenue should be recognized. It should also be noted that depreciation is not so much a matter of valuation as it is a means of cost allocation. These costs might be more readily apportioned if they are assigned by some device such as an applied rate. The disclosure requirement related to the method used in determining cost should be emphasized, indicating that where possible alternatives exist in financial reporting, disclosure in some format is required. Revenue should be recognized when a performance obligation is met. Note: Other stakeholders possibly affected are present and future consumers of electric power. CA Time 20—25 minutes Purpose—to provide the student with an opportunity to assess different points to report costs as expenses. That knowledge, if used with care, may also provide guidance in resolving new or emerging problems of financial accounting and reporting in the absence of applicable authoritative pronouncements. Investments by owners, comprehensive income.
CA Time 20—30 minutes Purpose—to provide the student with the opportunity to discuss the relevance and faithful representation of financial statement information.
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