Understanding Corporate Finance || with 100% Errorless Answers.

Financial Statements correct answers information used to assess the financial position and results of operations of corporations GAAP- a collection of rules and procedures which are overseen by authorities like the FASB and SEC correct answers Generally Accepted Accounting Principles FASB correct answers Financial Accounting Standards Board; explicit authority from SEC to monitor accounting standards SEC correct answers Securities and Exchange Commission accounting period correct answers goal of GAAP - financial reports should be prepared periodically an over periods of equal length; must be at least annually; period determined by company conservatism correct answers goal of GAAP - if certain situations lead to different likely profit figures, the firm should use the lowest measurement; firms must anticipate all expenses and not report revenues until realized. Deliberate understatement is forbidden. consistency correct answers goal of GAAP - firms should strive to use consistent accounting methods so that their statements can be compared over time matching correct answers goal of GAAP - in financial statements, companies should include all expenses incurred to realize the revenues that they report understandability correct answers goal of GAAP - information in reports should be written at a level that a reader with reasonable comprehension of business principles can understand reliability correct answers goal of GAAP - information that is provided must be complete and verifiable Required Statements correct answers balance sheet, income sheet, statement of owner's equity, statement of cash flows balance sheet correct answers statement of financial position describing a point in time (even 1 day) the assets, liabilities and owner's equity income statement correct answers shows all sources of revenues and expenses incurred for the period (range) in question and uses accrual accounting accrual accounting correct answers revenue that is recognized when earned and expenses that are realized when incurred