Fichas
Definitions - Chapter 2
Fichas del conjunto (48)
- 1Underlying AssumptionsFoundation of all accounting measurements.
- 2Qualitative CharacteristicsCriteria that in conjunction with reporting objectives, facts, and constraints, evaluate the possible measurement of options and choose the best measurement method
- 3Measurement MethodsVarious ways financial position, and the results of of operations can be reported. Ex. Fair realizable value
- 4Professional JudgementProcess of making or recommending choices in accounting.
- 5Ethical Professional JudgementActing ethically in exercising judgement. Factors to consider:
1. info needs of users
2. motivations of mangers
3. nature of operations
4. organizational reporting constraints - 6Universal Assumptionessential to making financial reports feasible and meaningful. Ex.
1. Time period
2. Separate entity
3. Unit of measure - 7Entity Specific AssumptionsDepend on individual entity's reporting circumstances. Ex.
1. Proprietary approach
2. Continuity
3. Stable currency - 8Separate Entity AssumptionEach specific, identifiable, business entity is considered an accounting unit separate from its owners and other entities
- 9Time-Period AssumptionIt is feasible to provide useful info in shorter periods while the enterprise is functioning
- 10Unit of Measure AssumptionThe results of a business's economic activities can be reported in terms of a standard monetary unit of measure through financial statements.
- 11Continuity AssumptionAKA Going concern assumption. Business is expected to continue operation sin the future.
- 12Purchasing Power ParityOver time the relative values of currencies will adjust to maintain their relative purchasing power.
- 13Capital MaintenancePreserving capital investment to continue successful operations.
- 14Nominal DollarsDollars of different vintages accounted for without regard to the fact that some have greater purchasing powers.
- 15Constant Dollar Capital MaintenanceRecognizes not all dollars are equal. A business must keep more nominal dollars invested in capital at the end of the year to to stay even or maintain capital.
- 16Physical Capital MaintenancePrices of individual goods change at different rates and in different directions. A company must be able to maintain the same level of of service or productivity.
- 17RelevanceMost important qualitative characteristic; means accounting info must be useful for decisions.
- 18Predictive ValueAccounting info should be helpful to external users by increasing their capacity to make predictions about the outcomes of future events.
- 19Confirmatory ValueAKA feedback value. Info should be helpful to external users who are confirming past predictions or making updates or corrections to them.
- 20Faithful RepresentationAccounting info should represent what it purports to and report the economic substance of transactions.
- 21Substance Over FromFaithfully representing the substance of a transaction.
- 22CompletnessInfo must not mislead or deceive; to ensure a faithful representation of events by giving a complete picture of facts and circumstances involved.
- 23NeutralityNot influencing decisions one way or another.
- 24Freedom from Material ErrorEstimates must be based on appropriate inputs and reflect the best available info.
- 25ComparabilityA factor when considering the relationship between two pieces of info.
- 26ConsistencyApplying concepts and principles from period to period in the same manner.
- 27UniformityUsing the same accounting methods for the same economic events.
- 28VerifabilityIf knowledgeable and independent observers can measure an economic event and arrive at the same result it is verifiable.
- 29TimelinessInfo reported on soon enough to be useful indecision making.
- 30UnderstandabilityInfo must be understandable and useful o users.
- 31Cost/Benefit EffectivenessAny accounting measurement or disclosure should result in greater benefits to users than it costs to present.
- 32Elementsdifferent classes of items in financial statements. Assets, liability, owner equity, revenues, expenses, other comprehensive income.
- 33IncomeAll increases in net assets flowing into an enterprise as the result of operating activities.
- 34ExpensesRelate to the ordinary activities of a company.
- 35Recognitionprocess of measuring and including an item in financial statements. A recognized item has a title and numerical value and applies to all financial statement elements.
- 36Executory ContractA contract where neither party has yet fulfilled the requirements of the contract
- 37RealizationProcess of converting and asset, liability, or commitment to a cash flow. Revenues are recognized when a sale is made and realized when a sale when the receivable is collected.
- 38MatchingCombined recognition of revenues and expenses that result from the same transaction.
- 39Net Asset Principle of Revenue/Expense RecognitionAn approach tot he joint adjustment of revenues and expense via increases and decreases in net assets minus liabilites.
- 40MeasurementProcess of determining the amount which an item is recognized in the financial statements.
- 41Current CostWhat it would cost to replace an asset or its productive capacity. Entry value.
- 42ConsiderationWhether the buyer gives the seller the payment.
- 43Historical Cost ConventionAcquisition cost used for initial accounting recognition. Entry value.
- 44Realizable ValueAn exit value, what can be recovered when an asset is disposed of.
- 45Present ValueValue of a future asset or liability with its interest components removed.
- 46Fair ValuePrice that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
- 47Orderly TransactionA transaction where buyer nor seller is under undue pressure to enter the transaction.
- 48ReservesItems in equity (IFRS). Estimated liabilities that appear on a company's financial statements that underlie reported expenses (common practice).
Información
- Descripción
- COMM 321 - Corporate Accounting Fichas sobre Definitions - Chapter 2, creado por Kelsey Topola el 10/05/2017.
- Creado por
- Kelsey Topola
- Visitas
- 3
- Etiquetas
- Valoración