HRTM 421 Exam 1 (Already Passed!)

financial Accounting correct answers produce financial statements that accurately present the financial condition of the company and its operating results over time Managerial Accounting correct answers provide more timely operating results related to revenues and expenses to help management maximize the operating performance of the business (FASB) correct answers Financial accounting standards board SEC correct answers Securities and exchange commission GAAP correct answers generally accepted accounting principles - govern all accounting and financial reporting Cost Principle correct answers - states that all transactions including the purchase or sale of an asset must be recorded at its cost rather than its market value - assets purchased should be recorded at cost or the price paid Full disclosure principle correct answers Events that could impact a company's financial position should be reflected on financial statements or footnotes The income statement presents: correct answers revenues, operating expenses, capital expenses, and profit and loss. Revenue Recognition Principle correct answers Revenues should be recorded in the month they are earned Matching principle correct answers All expenses incurred in generating a revenue should be recorded in the period the revenue is earned Monetary unit principle correct answers Only transactions that can be expressed in terms of money can be shown on a company's financial statements Economic entity principle correct answers Separates the dealings of a business from the private dealings of its owners Going concern principle correct answers Requires businesses to assume they will continue to operate long into the foreseeable future Time period principle correct answers The company must set specific time periods for measuring its financial results Materiality principle correct answers Significant revenues or expenses should have their own account on the income statement