BMAL-590 Week 2 Accounting/Basic
Accounting Concept section 3
Basic financial statements include: - correct answer ✔✔1. income statement
2. retained earnings statement
3. balance sheet
4. statement of cash flows
they are all interconnected
articulation of financial statements: - correct answer ✔✔the way accountants refer to the connection
between financial statements
basic elements of a financial accounting system: - correct answer ✔✔(1) standards for determining what,
when, and the amount that should be recorded for economic events,
(2) a framework for preparing financial statements, (3) controls to determine whether errors may have
arisen in the recording process.
GAAP - correct answer ✔✔Generally Accepted Accounting Principles
IFRS - correct answer ✔✔International Financial Reporting Standards
Generally Accepted Accounting Principles - correct answer ✔✔a set of accounting standards that is used
in the preparation of financial statements
International Financial Reporting Standards - correct answer ✔✔are used by companies domiciled in
many countries.
In recent years standard setting bodies have made progress to converge GAAP and IFRS standards.
Accounting Concept section 3
Basic financial statements include: - correct answer ✔✔1. income statement
2. retained earnings statement
3. balance sheet
4. statement of cash flows
they are all interconnected
articulation of financial statements: - correct answer ✔✔the way accountants refer to the connection
between financial statements
basic elements of a financial accounting system: - correct answer ✔✔(1) standards for determining what,
when, and the amount that should be recorded for economic events,
(2) a framework for preparing financial statements, (3) controls to determine whether errors may have
arisen in the recording process.
GAAP - correct answer ✔✔Generally Accepted Accounting Principles
IFRS - correct answer ✔✔International Financial Reporting Standards
Generally Accepted Accounting Principles - correct answer ✔✔a set of accounting standards that is used
in the preparation of financial statements
International Financial Reporting Standards - correct answer ✔✔are used by companies domiciled in
many countries.
In recent years standard setting bodies have made progress to converge GAAP and IFRS standards.
