Generally Accepted Accounting Principles (GAAP):
They are commonly known as GAAP. It is a collection of generally practiced and followed rules and standards of accounting. GAAP provides global guidelines for preparation and disclosure of financial statements of public companies. It is created and developed by International Accounting Standards Board (IASB).
International Financial Reporting Standards (IFRS):
It is a collection of generally practiced and followed rules and standards of accounting. GAAP provides global guidelines for preparation and disclosure of financial statements of public companies. It is created and developed by International Accounting Standards Board (IASB).
To compare: The financial statement terms used in GAAP that contrast with IFRS
Explanation of Solution
Comparison of financial statement terms used in GAAP that contrasts with IFRS:
GAAP Financial Statement Term | IFRS Financial Statement Term |
Statement of comprehensive income | Statement of comprehensive income |
Interest expense | Finance costs |
Net income | Profit for the year |
Excess of issue price over par | Share premium |
Trading investments | Financial assets at fair value through profit or loss |
Wages payable, or salaries payable, or payroll taxes payable | Employee provisions |
Notes payable | Loans |
Balance sheet |
Table (1)
Thus, the financial statement terms used in GAAP are compared with those used in IFRS.
Want to see more full solutions like this?
Chapter 13MJ Solutions
Financial & Managerial Accounting
- Which of the following would be considered a cash outflow for investing activities? a. cash paid to purchase product for inventory b. cash paid to reacquire common stock c. cash paid to repay debt d. cash paid to purchase equipmentarrow_forwardHow do creditors assess risk when lending funds to a company?arrow_forwardWhat is the Objective: Useful Information about Net Cash Inflows to the Company, and why is it important?arrow_forward
- Which of the following represents a source of cash in the investing section? A. sale of investments B. depreciation expense C. decrease in accounts receivable D. decrease in bonds payablearrow_forwardWhich of the following would be classified as a cash outflow from an operating activity? a. Purchase of an investment b. Payment of dividends c. Purchase of equipment d. Payment of goods purchased from suppliersarrow_forwardInvesting activities are those transactions dealing with the exchange of cash between the company and its stockholders and creditors.arrow_forward
- What insight does the calculation of free cash flow provide about the companys cash flow position?arrow_forwardonly the Final answer without explain All of the following are examples of cash outflows from an investing activity except loans made to another party. purchase of equity securities. purchase of treasury stock. purchase of commercial real estate.arrow_forward
- Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage LearningCollege Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax CollegeCentury 21 Accounting Multicolumn JournalAccountingISBN:9781337679503Author:GilbertsonPublisher:Cengage