Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

15. GAAP vs IFRS

GAAP vs. IFRS: Introduction

Financial Accounting

15. GAAP vs IFRS

GAAP vs. IFRS: Introduction

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Multiple Choice

Generally Accepted Accounting Principles (GAAP) require that financial information possess which of the following characteristics?

Uniformity and tax compliance

Relevance and reliability

Flexibility and subjectivity

Historical cost and secrecy

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Verified step by step guidance

Understand the purpose of Generally Accepted Accounting Principles (GAAP), which is to ensure that financial information is useful and trustworthy for decision-making.

Recognize that GAAP emphasizes the importance of financial information being relevant, meaning it should be applicable and helpful for users in making economic decisions.

Understand that GAAP also requires financial information to be reliable, meaning it should be accurate, verifiable, and free from bias.

Eliminate incorrect options by analyzing their alignment with GAAP principles: 'Uniformity and tax compliance' is not a primary focus of GAAP, 'Flexibility and subjectivity' contradicts the need for reliability, and 'Historical cost and secrecy' does not align with transparency and relevance.

Conclude that the correct characteristics required by GAAP are 'Relevance and reliability,' as these ensure the financial information serves its intended purpose effectively.