Explain why financial statement information has characteristics of a public good. Include a definition of a public goods in your answer. What does this imply about using the extent of security market reaction to accounting information to guide accountants?
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Explain why financial statement information has characteristics of a public good. Include a definition of a public goods in your answer. What does this imply about using the extent of security market reaction to accounting information to guide accountants?
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- 20)Which of the following is the best definition of an internal user of accounting information? A) Creditors, such as banks, that use accounting information to evaluate the risk of lending money B) Investors who use accounting information to decide whether to buy or sell stock C) Managers who use accounting information to plan, organize, and run a business D) Labor unions who use accounting information to examine the ability of the company to pay increased wages and benefits6. How and why would the accounting profession use the results of behavioural research in accounting?7. From a behavioral theory perspective, why does it matter how assets and liabilities are measured? 8. Briefly explain the Brunswik Lens Model and its relevance to explaining the various facts of the decision making process.7) The goal of management accounting is to: a. Help the investors to make decisions b. Help the government to monitor company’s activities c. Help managers to make decisions d. Help bankers to make lending decisions
- 17. Which of the following is an example of information intermediary? Select one: a. Internal managers b. Tax authority c. Auditors. d. Commercial banks19.The government regulates financial market and financial institutions for three main reasons. What are those reasons? I. To ensure the soundness of financial market and institutionII. To ensure the soundness of the financial systemIII. To increase the information available to the investorsIV. To increase the information available to the users.V. To improve control of the financial informationVI. To improve control of financial system. a. I, II, V b. I, III, IV c. II, III, IV d. II, III, VI13. Which of the following is NOT an obligation or duties of an auditor? a. Inspect account books and accounting systems for efficiency b. Prepare detailed reports on audit findings c. Examine and evaluate financial and information systems d. Helps to prepare the financial statements of companies
- Which of the following refers to financial accounting? Question 9 options: a) Regulations or standards govern the information provided to users. b) The focus is on using information from the formal accounting system to guide the organization's activities. c) Reports provided to users are timely and focus on the future. d) The users of the information provided include managers and executives within the organization. e) Users utilize both financial as well as nonfinancial information to make decisions.Question: Accounting information is designed to meet the needs of: a. potential investors only. b. management c . government agencies only. d. Internal and external users. Required: please answer this question by choosing the right options.1. Explain why the discussion of the usefulness of accounting information is focused mainly on investors and creditors. What is your view on this?
- Question 12 What is the objective of financial reporting? Answers: Provide information that clearly portrays nonfinancial transactions. Provide information that excludes claims to the resources. Provide information about the reporting entity that is useful to present and potential equity investors, lenders, and other creditors. Provide information that is useful to management in making decisions.5 A conceptual framework for financial reporting is a statement of generally accepted theoretical principles, which provide the basis for __________________. i)Development of new accounting standards ii)Development of accounting staff through training programs iii)Evaluation of accounting standards which already in existence. iv)Developing quality control methods to enhance the quality of products and services. a. iii) & iv) b. ii) & iv) c. i) & iii) d. i) & ii)Indicate whether the following statements about the conceptual framework are true or false. If false, provide a brief explanation supporting your position. a. Accounting rule-making that relies on a body of concepts will result in useful and consistent pronouncements. b. General-purpose financial reports are most useful to company insiders in making strategic business decisions. c. Accounting standards based on personal conceptual frameworks generally will result in consistent and comparable accounting reports. d. Capital providers are the only users who benefit from general-purpose financial reporting. e. Accounting reports should be developed so that users without knowledge of economics and business can become informed about the financial results of a company. f. The objective of financial reporting is the foundation from which the other aspects of the framework logically result.
