close solutoin list

At the completion of the Darby Department Store audit, the president asks about the meaning of the phrase "in conformity with generally accepted accounting, principles" that appears in your audit report on the management's financial statements. He observes that the meaning of the phrase must include more than what he thinks of as "principles." Required : Explain the meaning of the term "accounting principles" as used in the audit report. (Do not discuss in this part the significance of "generally accepted.") The president wants to know how an accounting principle becomes "generally accepted." Prepare a brief memo that provides an answer to the president's question.

BuyFind

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281
BuyFind

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281

Solutions

Chapter
Section
Chapter 1, Problem 1C
Textbook Problem

At the completion of the Darby Department Store audit, the president asks about the meaning of the phrase "in conformity with generally accepted accounting, principles" that appears in your audit report on the management's financial statements. He observes that the meaning of the phrase must include more than what he thinks of as "principles."

Required:

  1. Explain the meaning of the term "accounting principles" as used in the audit report. (Do not discuss in this part the significance of "generally accepted.")
  2. The president wants to know how an accounting principle becomes "generally accepted." Prepare a brief memo that provides an answer to the president's question.

Expert Solution

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

See Solution

*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.

Chapter 1 Solutions

Intermediate Accounting: Reporting And Analysis
Show all chapter solutions
Ch. 1 - What role does the EITF play in assisting the FASB...Ch. 1 - What is the FASB Accounting Standards...Ch. 1 - Briefly describe the process followed by the FASB...Ch. 1 - How are the FASB and IASB different, and how are...Ch. 1 - What are International Financial Reporting...Ch. 1 - How are U.S. GAAP and IFRS changing over time?Ch. 1 - Are accounting standards established by the FASB...Ch. 1 - What is the purpose of a balance sheet? What...Ch. 1 - What is the purpose of an income statement? What...Ch. 1 - What is the purpose of a statement of cash flows?...Ch. 1 - What is the purpose of the statement of...Ch. 1 - Why do companies provide so much additional...Ch. 1 - How are changes in stock prices associated with...Ch. 1 - Why do accountants have to be ethical in their...Ch. 1 - What are the six principles of the AICPA Code of...Ch. 1 - Pronouncements Although U.S. GAAP is now organized...Ch. 1 - At the completion of the Darby Department Store...Ch. 1 - Considerable political and social influence is...Ch. 1 - The FASB is organized to establish generally...Ch. 1 - In a few years, you may become a member of the...Ch. 1 - One of your friends remarks, I understand that...Ch. 1 - Your friend who is taking his first accounting...Ch. 1 - Starbuckss Financial Statements A friend is very...Ch. 1 - You have just become friends with an exchange...Ch. 1 - You are preparing to visit a friend who now lives...Ch. 1 - Situation You are working as a teaching assistant...Ch. 1 - Codification Situation You are conducting an...Ch. 1 - Codification Situation You are conducting an...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions
Explain the seven major warehousing activities.

Foundations of Business (MindTap Course List)

A bond that pays interest forever and has no maturity is a perpetual bond. In what respect is a perpetual bond ...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)