, SOLUTION
MANUAL FOR
FINANCIAL
STATEMENT
EDITION BY CHARLES
H. GIBSON ALL
CHAPTERS
CORRECTLY
, Chapter c 1 Introduct
cion c to c Financial c Reporting
QUESTIONS
1- c1. a.
The c AICPA c is c an c organization c of c CPAs c that c prior
c to c 1973 c ac ccepted c the c primary c responsibility c for c the
c development c of c generall cy c accepted c accounting c principles.
c Their c role c was c substantially c re cduced c in c 1973 c when
c the c Financial c Accounting c Standards c Board cwas c established.
Their c role c was c further c reduced c with c the
c esta cblishment c of c the c Public c Company c Accounting
c Oversight c Board c w cas c established c in c 2002.
b. The c Financial c Accounting c Standards c Board c replaced
c the c Acc counting c Principles c Board c as c the c primary
c rule-
making c body c for c accounting c standards. c It c is c an
c independent corganization c and c includes c members c other
c than c public c acco
untants.
c. The c SEC c has c the c authority c to c determine c generally
c accepted c a cccounting c principles c and c to c regulate c the
c accounting c profession. cThe c SEC c has c elected c to c leave
c much c of c the c determination c of c generally c accepted
c accounting c principles c to c the c private c sector.
The c Financial c Accounting c Standards c Board c has c played
c the cmajor c role c in c establishing c accounting c standards
c since c 1973. R
cegulation c of c the c accounting c profession c was c substantially
c turned cover c to c the c Public c Company c Accounting
c Oversight c Board c in c 2 c 002.
1- c 2.
, tency cis cobtained cthrough cthe capplication cof cthe csame ca cccounting
c principle c from c period c to c period. c c A c change c in
C
c principl ce c requires c statement c disclosure.
o
n
s
i
s
1-
c 3. The c concept c of c historical c cost c determines c the c balance
c sheet c valuatio cn c of c land. c The c realization c concept c requires
c that c a c transaction c needs cto c occur c for c the c profit c to c be
c recognized.
1- 4. a. Entity e. Historical c cost
b. Realization f. Historical c cost
c. Materiality g. Disclosure
MANUAL FOR
FINANCIAL
STATEMENT
EDITION BY CHARLES
H. GIBSON ALL
CHAPTERS
CORRECTLY
, Chapter c 1 Introduct
cion c to c Financial c Reporting
QUESTIONS
1- c1. a.
The c AICPA c is c an c organization c of c CPAs c that c prior
c to c 1973 c ac ccepted c the c primary c responsibility c for c the
c development c of c generall cy c accepted c accounting c principles.
c Their c role c was c substantially c re cduced c in c 1973 c when
c the c Financial c Accounting c Standards c Board cwas c established.
Their c role c was c further c reduced c with c the
c esta cblishment c of c the c Public c Company c Accounting
c Oversight c Board c w cas c established c in c 2002.
b. The c Financial c Accounting c Standards c Board c replaced
c the c Acc counting c Principles c Board c as c the c primary
c rule-
making c body c for c accounting c standards. c It c is c an
c independent corganization c and c includes c members c other
c than c public c acco
untants.
c. The c SEC c has c the c authority c to c determine c generally
c accepted c a cccounting c principles c and c to c regulate c the
c accounting c profession. cThe c SEC c has c elected c to c leave
c much c of c the c determination c of c generally c accepted
c accounting c principles c to c the c private c sector.
The c Financial c Accounting c Standards c Board c has c played
c the cmajor c role c in c establishing c accounting c standards
c since c 1973. R
cegulation c of c the c accounting c profession c was c substantially
c turned cover c to c the c Public c Company c Accounting
c Oversight c Board c in c 2 c 002.
1- c 2.
, tency cis cobtained cthrough cthe capplication cof cthe csame ca cccounting
c principle c from c period c to c period. c c A c change c in
C
c principl ce c requires c statement c disclosure.
o
n
s
i
s
1-
c 3. The c concept c of c historical c cost c determines c the c balance
c sheet c valuatio cn c of c land. c The c realization c concept c requires
c that c a c transaction c needs cto c occur c for c the c profit c to c be
c recognized.
1- 4. a. Entity e. Historical c cost
b. Realization f. Historical c cost
c. Materiality g. Disclosure
