FAC1601 FINANCIAL ACCOUNTING
REPORTING 2026 ACTUAL PAPER
QUESTIONS SOLUTIONS GRADED PLUS
PREMIUM
◉ GAAP is a dynamic set of both ___________________________ that
companies should follow when measuring and reporting the
information in their financial statements and related notes.
Answer: Broad and Specific Guidelines
◉ GAAP facilitates decision making by investors and creditors by
allowing them to _____________ financial information among
companies.
Answer: Compare
◉ Hierarchy of Standard Setting Authority
Answer: congress
SEC
private sector
CAP, APB, FASB
, ◉ Who has the ultimate legal authority to establish accounting
standards in the US?
Answer: SEC
◉ What does FASB stand for?
Answer: Financial Accounting Standards Board
◉ When was the FASB created?
Answer: 1973
◉ Why was the FASB created?
Answer: Due to Criticism of Previous Agencies and To Set U.S
Accounting Standards
◉ What is the Parent Agency of the FASB?
Answer: Financial Accounting Foundation (FAF)
◉ What does the FAF do for the FASB?
Answer: Selects Members, Oversees FASB's Activities, and Ensures
adequate funding.
◉ How Many full-time FASB members are there at a given time and
where are they from?
REPORTING 2026 ACTUAL PAPER
QUESTIONS SOLUTIONS GRADED PLUS
PREMIUM
◉ GAAP is a dynamic set of both ___________________________ that
companies should follow when measuring and reporting the
information in their financial statements and related notes.
Answer: Broad and Specific Guidelines
◉ GAAP facilitates decision making by investors and creditors by
allowing them to _____________ financial information among
companies.
Answer: Compare
◉ Hierarchy of Standard Setting Authority
Answer: congress
SEC
private sector
CAP, APB, FASB
, ◉ Who has the ultimate legal authority to establish accounting
standards in the US?
Answer: SEC
◉ What does FASB stand for?
Answer: Financial Accounting Standards Board
◉ When was the FASB created?
Answer: 1973
◉ Why was the FASB created?
Answer: Due to Criticism of Previous Agencies and To Set U.S
Accounting Standards
◉ What is the Parent Agency of the FASB?
Answer: Financial Accounting Foundation (FAF)
◉ What does the FAF do for the FASB?
Answer: Selects Members, Oversees FASB's Activities, and Ensures
adequate funding.
◉ How Many full-time FASB members are there at a given time and
where are they from?
