The conceptual framework indicates the desired fundamental and enhancing qualitative characteristics of accounting information Several constraints impede achieving these desired characteristics. Answer each of the following questions related to these characteristics and constraints. 1. 2. Donald Kirk, former chairman of the FASB, once noted that "... there must be public confidence that the standard-setting system is credible, that selection of board members is based on merit and not the influence of special interests..." Which characteristic is implicit in Mr. Kirk's statement? 3. Which component would allow a large company to record the purchase of a $120 printer as an expense rather than capitalizing the printer as an asset? 7 Allied Appliances, Inc., changed its revenue recognition policies. Which characteristic is jeopardized by this change? National Bancorp, a publicly traded company, files quarterly and annual financial statements with the SEC. Which characteristic is relevant to the timing of these periodic filings? 4. 5. In general, relevant information possesses which qualities? 6. When there is agreement between a measure or description and the phenomenon it purports to represent, information possesses which characteristic? Jeff Brown is evaluating two companies for future investment potential. Jeff's task is made easier because both companies use the same Comparability
The conceptual framework indicates the desired fundamental and enhancing qualitative characteristics of accounting information Several constraints impede achieving these desired characteristics. Answer each of the following questions related to these characteristics and constraints. 1. 2. Donald Kirk, former chairman of the FASB, once noted that "... there must be public confidence that the standard-setting system is credible, that selection of board members is based on merit and not the influence of special interests..." Which characteristic is implicit in Mr. Kirk's statement? 3. Which component would allow a large company to record the purchase of a $120 printer as an expense rather than capitalizing the printer as an asset? 7 Allied Appliances, Inc., changed its revenue recognition policies. Which characteristic is jeopardized by this change? National Bancorp, a publicly traded company, files quarterly and annual financial statements with the SEC. Which characteristic is relevant to the timing of these periodic filings? 4. 5. In general, relevant information possesses which qualities? 6. When there is agreement between a measure or description and the phenomenon it purports to represent, information possesses which characteristic? Jeff Brown is evaluating two companies for future investment potential. Jeff's task is made easier because both companies use the same Comparability
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter1: The Demand For And Supply Of Financial Accounting Information
Section: Chapter Questions
Problem 2C
Related questions
Question
Expert Solution
Step 1
A conceptual framework is a type of document that helps a company in drafting policies in the absence of international financial reporting standards. The concept shows certain criteria to be followed in drafting the policies.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q…
Accounting
ISBN:
9781305080577
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
South-Western College Pub
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q…
Accounting
ISBN:
9781305080577
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College