Intrm'd Chapter 1

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accountingfun
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256810
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Intrm'd Chapter 1
Updated:
2014-01-16 15:23:37
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accounting terms
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Description:
Intermediate accounting ch.1 terms
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  1. Comparability
    helps uses see similarities and differences between events and conditions.
  2. Verifiability
    implies that different knowledgeable and independent measurers would reach consensus regarding whether information is a faithful representation of what it is intended to depict.
  3. Timeliness
    important for information to be useful. Information is timely when it’s available to users early enough to allow them to use it in their decision process.
  4. Understandability
    users must be able to comprehend the information within the context of the decision being made.
  5. Expenses
    outflows or other using up of assets or incurrences of liabilities during a period from delivering or producing goods, rendering services, or other activities that constitute the entity’s ongoing major or central operations.
  6. Gains
    increases in equity from peripheral or incidental transactions of an entity.
  7. Economic Entity
    All economic events can be identified with a particular economic entity
  8. Going concern
    In the absence of information to the contrary, it is anticipated tat a business entity will continue to operate indefinitely
  9. Periodicity
    The life of a company can be divided into artificial time periods to provide timely information to external users
  10. Monetary unit
    In the US, financial statement elements should be measured in terms of US dollar
  11. Assets
    Probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events
  12. Liabilities
    Probable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events
  13. Equity ( or net assets)
    it is the residual interest in the assets of an entity that remains after deducting its liabilities
  14. Revenues
    Inflows or other using up of assets of an entity or settlements of its liabilities during a period from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations
  15. Expenses
    Outflows or other using up of assets or incurrences of liabilities during a period from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations
  16. Neutrality
    neutral with respect to parties potentially affected
  17. Consistency
    permits valid comparisons between different periods
  18. Materiality
    if a more costly way of providing information is not expected to have a material effect on decision made by those using the information the less costly method may be acceptable
  19. Historical costs
    original transaction value
  20. Losses
    decreases in equity arising from peripheral or incidental transactions of the entity.

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