Intermediate Accounting 1-
Chapter 1 Questions With
Accurate Answers
AICPA correct answer American Institute of CPAs
Describe some of the challenges facing financial reporting correct answer -Non-
financial measurements
-Forward-looking information
-Soft assets
-Timeliness
-Understandability
Difference between FASB and APB: correct answer - Smaller Membership
- Full-time, remunerated membership
- Greater autonomy
- Increased Independence
- Broader Representation
Economic consequences of accounting standard-setting means correct answer
Accounting standards can have detrimental impacts on the wealth level of the
providers of financial information
external users correct answer external users - actual or potential investors
(stockholders and bondholders) and creditors (such as suppliers and lending
institutions)
, FASB correct answer Financial Accounting Standards Board
FASB's mission correct answer To establish and improve standards of financial
accounting and reporting
financial accounting correct answer financial accounting - the information
accumulation, processing, and communication system designed to provide
investment and credit decision-making information for external users
financial reporting correct answer financial reporting - the process of
communicating financial accounting information about a company to external
users
GAAP correct answer Generally Accepted Accounting Principles- the guidelines,
procedures, and practices that a company is required to use in recording and
reporting the accounting information in its audited financial statements.
GAAP is comprised of correct answer Any accounting guidance in the FASB
codification
General-purpose financial statements are preapared primarily for correct answer
External users
IASB correct answer International Accounting Standards Board
Chapter 1 Questions With
Accurate Answers
AICPA correct answer American Institute of CPAs
Describe some of the challenges facing financial reporting correct answer -Non-
financial measurements
-Forward-looking information
-Soft assets
-Timeliness
-Understandability
Difference between FASB and APB: correct answer - Smaller Membership
- Full-time, remunerated membership
- Greater autonomy
- Increased Independence
- Broader Representation
Economic consequences of accounting standard-setting means correct answer
Accounting standards can have detrimental impacts on the wealth level of the
providers of financial information
external users correct answer external users - actual or potential investors
(stockholders and bondholders) and creditors (such as suppliers and lending
institutions)
, FASB correct answer Financial Accounting Standards Board
FASB's mission correct answer To establish and improve standards of financial
accounting and reporting
financial accounting correct answer financial accounting - the information
accumulation, processing, and communication system designed to provide
investment and credit decision-making information for external users
financial reporting correct answer financial reporting - the process of
communicating financial accounting information about a company to external
users
GAAP correct answer Generally Accepted Accounting Principles- the guidelines,
procedures, and practices that a company is required to use in recording and
reporting the accounting information in its audited financial statements.
GAAP is comprised of correct answer Any accounting guidance in the FASB
codification
General-purpose financial statements are preapared primarily for correct answer
External users
IASB correct answer International Accounting Standards Board
