Why does stakeholder impact analysis matter? [Financial Accounting] a) Impact remains constant b) Shareholders alone matter c) Users need identical information d) Different user needs affect reporting choices
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- Which of the following is true about earnings management? A. It works within the constraints of GAAP. B. It works outside the constraints of GAAP. C. It tries to improve stakeholders views of the companys financial position. D. Both B and C E. Both A and CExplain clearlyThe objective of general-purpose financial reporting is? to provide users with financial information that implies total freedom from error to provide companies with the option to select information that favors one set of interested parties over another O to provide financial information about the reporting entity that is useful to present and potential equity investors, lender and other creditors in making decisions in their capacity as capital providers to provide a metric for financial information used to determine when the boundary between two or more entities should disregarded and the entities considered to be a licensing arrangement
- Management is a user of financial analysis. Which of the following comments does not represent a fair statement as to the management perspective? A. Management is always interested in maximum profitability. B. Management is interested in the view of investors. C. Management is interested in the financial structure of the entity. D. Management is interested in the asset structure of the entityFinancial statements should be based on accounting principles alone and not serve the interests of any particular user group. Which characteristic of a good financial statement does this refer to? A. Reliability B. Relevant C. Comparable D. NeutralWhich concept states that any policies adopted for accounting should not change frequently unless it is the demand of the changing circumstances Oa. Cost Concept O b. Money Measurement Concept Oc. Consistency Concept O d. Going Concern Concept
- What is probably the greatest single reason conventional financial statements are inadequate for analysis? a. Accrual accounting b. Historical cost c. Matching rule d. Going concern conceptExternal decision makers would not look primarily to financial accounting information to assist them in making decisions on: A. Granting credit B. Capital budgeting C. Selecting stocks D. Mergers and acquisitionsDiscuss the descriptive approach in financial accounting theory. What are the limitations of this approach? “Decision-usefulness approach focuses on the relevance of information being communicated.” Explain this statement.