Concept explainers
Balance Sheet
This is a financial statement where the assets, liabilities, and
Financial Disclosure
Financial disclosure refer to all material, significant and relevant information concerning the reporting organization that are essential to understand the financial statements of the organization in its entirety and help evaluating the performance and the financial health of the said organization. They are either provided on the face of the financial statement or as notes to the financial statements as supporting schedules.
To Match: List A items with list B with most approximate terms and phrases.
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Intermediate Accounting, 10 Ed
- QUESTION 10 Which of the following in accounts would be classified as current assets on the balance sheet? a. Accounts receivable, inventory, cash equivalents b. Pre-paid expenses, goodwill, long term investments C. Property, plant and equipment, inventory and goodwill d. Marketable securities, accounts payable, property plant and equipmentarrow_forward95 Conceptual Framework Information that is capable of making a difference in the decisions made by users has this qualitative characteristic. a. Relevance b. Faithful representation 2. c. Timeliness d. Verifiability 3. When making materiality judgments, the overriding consideration is a. the ability of the item being judged to influence users' decisions. b. the size of the impact of the item being judged. the characteristics of the item being judged. C. d. cand d 4. This qualitative characteristic is unique in the sense that it necessarily requires at least two items. a. Verifiability b. Faithful representation c. Timeliness d. Comparability 5. Which of the following enhances the comparability of information? a. Making unlike things look alike. b. Making like things look different. c. Using different methods to account for similar transactions from period to period. d. Consistent application of accounting policies from period to period. 6. Information has this qualitative…arrow_forwardIntermediate Accounting 105 What is the purpose of a statement of cash flows? How does it differ from a balance sheet and an income statement? Please provide GAAP concept and own explanation / example.arrow_forward
- Your answer: Chapter 2 2 8 14 B. Answer the following chapter-end question. Chapter 2 Q. 1. Identify the four financial statements and describe the purpose of each. Your answer: Q. 6. Explain the difference between current and noncurrent assets and liabilities. Why is this distinction important to stakeholdersarrow_forwardMatch the words to the definitions. Solvency Accounts Receivable Balance Sheet Noncurrent Assets Income Statement Retained Earnings Noncurrent Liabilities. Liquidity Current Assets Cash Flow Statement ✓ [Choose ] A forecast of the amount and timing of future cash inflows and outflows over some period of time. A summary of the revenues and expenses of a business over a given period of time. When net worth is greater than zero, or assets are greater than liabilities on the balance sheet. The ability to meet the day-to-day cash needs of the firm. Profits that are not paid out in dividends but are reinvested in the firm itself. Summarizes a firm's financial position at a given point in time and lists the firm's assets, liabilities, and net worth. Debts that others owe the business, usually arising from previous credit sales. Something the firms owns or uses that will not turn into cash within the next accounting period. Either cash or an items that will become cash in the next accounting…arrow_forwardQuestion 3 Explain the following accounting terms used in the preparation and presentation of published financial statements: Reserves Earnings per share Debenture interest Share premiumarrow_forward
- What is the purpose of the statement of cash flows? One or two paragraph minimum CH 15arrow_forwardductory financial accounting_ Liquidity is simply: O a. another term for non-current assets O b. a company's ability to pay obligations when due O c. another term for current liabilities O d. another term for cash ype here to searcharrow_forwardQUESTION TWO c. The IASB Conceptual Framework for Financial Reporting has identified certain qualitativecharacteristics of information in financial statements. Identify and explain briefly the six(6) qualitative characteristics of financial reporting.arrow_forward
- Question 33 Credits always increase which accounts? Assets, Liabilities and Common Stock Liabilities, Revenues and Common Stock O Assets, Dividends, Expenses O Revenues, Liabilities and Dividendsarrow_forwardQuèstion 9 Who are the primary users of general-purpose financial statements? O A. Creditors O B. Investors OC. Government O D. Both creditors and investorsarrow_forwardMatch the following terms or phrases in (a–g) with the explanations in 1–8. Terms or phrases may be used more than once. Question 11 options: Current assets/Current liabilities Probable likelihood and estimable liability Measures the “instant” debt-paying ability of a company Current assets – Current liabilities (Cash + Temporary investments + Accounts receivable)/Current liabilities Cash + Temporary investments + Accounts receivable Probable likelihood of a liability but cannot be estimated Remote contingent liability Reasonably possible likelihood of a liability 1. Current ratio 2. Working capital 3. Quick assets 4. Quick ratio 5. Record an accrual and disclose in the notes to the financial statements 6. Disclose only in notes to financial statements 7. No disclosure needed in notes to financial statementsarrow_forward
- Financial Accounting: The Impact on Decision Make...AccountingISBN:9781305654174Author:Gary A. Porter, Curtis L. NortonPublisher:Cengage Learning