Int. Accounting (Ch. 4)

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Dbadams94
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308171
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Int. Accounting (Ch. 4)
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2015-09-20 02:51:43
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ACC
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ACC
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  1. Income information is useful for what 3 things? (EPD)
    • 1. Evaluating past performance
    • 2. Predicting future performance
    • 3. Determining risk
  2. 3 limitations of the incomes statement.
    • 1. Omits items that can't be measured, but contribute to income.
    • 2. Accounting methods differ
    • 3. Judgments/Estimates
  3. Involves planned timing of revenues , expenses, gains, and losses to achieve a particular income result or earnings trend.
    Earnings management
  4. Earnings management decreases the...
    quality of earnings.
  5. Earnings management... the quality of earnings.
    decreases
  6. 4 elements of the income statement. (REGL)
    • 1. Revenues
    • 2. Expenses
    • 3. Gains
    • 4. Losses
  7. Inflow of net assets from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing primary or central operations.
    Revenue
  8. Outflows or using up of assets or incurring liabilities from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing primary or central operations.
    Expenses
  9. Increases in net assets from peripheral activities that are not part of the entity's ongoing primary or central operations.
    Gains
  10. Decreases in net assets from peripheral activities that are not part of the entity's ongoing primary or central operations.
    Losses
  11. Pro Forma Income Statements are also known as...
    "as if" income statements
  12. Type of income statement that adjusts income or excludes items that the company believes are not representative of operating results.
    Pro Forma Income Statement
  13. Type of income statement that groups all revenues together and all expenses together.
    Singe-step Income Statement
  14. Type of income statement that separates operating and non-operating activities and reflects several important subtotals.
    Multiple-step Income Statement
  15. "Income from continuing operations" is the best predictor of...
    future earnings.
  16. 2 parts of discontinued operations.
    • Income (loss) from operations, net of tax
    • 2. Gain (loss) from operations, net of tax
  17. Discontinued operations take place when what 2 things happen?
    • 1. Company eliminates a component of the business
    • 2. No significant continuing involvement
  18. A component relating to discontinued operations (is/is not) a product within a product line.
    is not
  19. Discontinued operations IS shown...
    net of tax.
  20. 2 unusual items on the income statement. (OO)
    • 1. Other revenues and gains
    • 2. Other expenses and losses
  21. Unusual items on the income statement are NOT shown...
    net of tax.
  22. Unusual items on the income statement are included with...
    income from continuing operations.
  23. The portion of equity interest in the subsidiary, not attributable to the parent.
    Non-controlling interest
  24. A change in accounting method or adoption of new accounting principle.
    Change in accounting principle
  25. 2 parts of change in an estimate. (NA)
    • 1. No retrospective adjustment 
    • 2. Accounted for only in current and future periods
  26. The correction of errors made in previous accounting periods.
    Prior period adjustments
  27. Prior period adjustments includes adjustment to...
    beginning RE
  28. Earnings per share formula.
    (NI - preferred dividends) / (Weighted average # of common shares outstanding)
  29. Earnings per share must be disclosed on the income statement for what 2 things? (IN)
    • 1. Income from continuing operations
    • 2. Net income
  30. The process of associating income tax expense with related income.
    Intraperiod tax allocation
  31. Intraperiod tax allocation involves what 4 things? (IDNP)
    • 1. Income from continuing operations
    • 2. Discontinued operations
    • 3. Net income
    • 4. Prior period adjustments

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