ACCT 320 KU Exam 1 Questions and Answers Already Passed Rated 100%

ACCT 320 KU Exam 1 Questions and Answers Already Passed Rated 100% Balance Sheet - Answers Resources and claims to those resources at a specific time. Income Statement - Answers Revenues, expenses, gains, and losses over a period of time Statement of Cash Flows - Answers Sources and uses of cash over a period of time Statement of Comprehensive Income - Answers Net income +/- other comprehensive income Parties Involved in Financial Reporting - Answers 1. SEC 2. American Institute of Certified Public Accountants (AICPA) 3. Financial Accounting Standards Board (FASB) Issues in Financial Reporting - Answers 1. GAAP in political environment 2. The expectations gap 3. Sarbanes-Oxley Act (SOX) 4. Financial Reporting challenges 5. International Accounting Standards 6. Ethics in the environment of financial accounting Sarbanes-Oxley Act (SOX) - Answers a. Increased financial resources to the SEC to combat fraud. b. Established the Public Accounting Oversight Board. c. Established stronger independence rules for auditors d. Required CEO's and CFO's to personally certify financial statements and disclosures e. Required that audit committees have independent memebers including ones with financial expertise f. established a code of ethics for senior financial officers Fundamental Qualities - Answers 1. Relevance 2. Faithful Representation Enhancing Qualities - Answers 1. Comparability 2. Verifiability 3. Timeliness 4. Understandability Relevance - Answers A fundamental quality that pertains to the decision at hand. Capable of making a difference in a decision. Faithful Representation - Answers A fundamental quality whose information can be relied upon to reflect what really happened or existed. Comparablility - Answers An enhancing quality whose accounting methods/measurements are similar from company to company and from period to period within a company. Verifiability - Answers An enhancing quality where others can reach the same conclusions or observe the same results; role of the external auditors Timeliness - Answers Information must be timely to be relevant