Financial Accounting and Reporting Case: America Online 1. What accounting approach has AOL used in the past that it is now changing (related to the $385 million)? AOL‚ prior to October 1‚ 1996‚ recorded the expenditure related to subscribers acquisitions as an asset and amortized monthly over a period < 24 months. This was a strongly criticized approach. Furthermore‚ the accounting approach in the article is considered aggressive. In October 1996‚ they discontinued capitalizing customer acquisition
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Financial accounting is the only branch of accounting and it is not perfect. There are large numbers of limitations which open new way to use other tools of accounting. To know what are the main limitations of financial accounting. It is very necessary for accountants. Accountants are often blind to these limitations. So‚ I am covering its limitation a lot of ground. Read below and understand:- Net effect of transactions are recorded in financial accounting which has happened in past. These
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Date: _____________ 1.|An account is a part of the financial information system and is described by all except which one of the following?| A)|An account has a debit and credit side.| B)|An account is a source document.| C)|An account consists of three parts.| D)|An account has a title.| 2.|Which statement about an account is true?| A)|In its simplest form‚ an account consists of two parts.| B)|An account is an individual accounting record of increases and decreases in specific asset
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The Financial Accounting Standards Board employs a "due process" system which (Points: 5) has all CPAs in the United States vote on a new Statement. enables interested parties to express their views on issues under consideration. identifies the accounting issues that are the most important. requires that all accountants receive a copy of financial standards. 2. (TCO A) The IASB: (Points: 5) governs accounting standards in the U.S. is working on a convergence project with the FASB. sets the
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CHAPTER 1: INTRODUCTION TO FINANCIAL ACCOUNTING 1.1 USE‚ PREPARATION AND CONCEPTS * Use: The information derived from financial accounting is used by managers‚ investors‚ bankers‚ financial analysts and accountants‚ helping them to learn how to use information effectively and to do their jobs better. This information is essential to accountants for the services they provide. * Preparation: to be effective users of accounting information‚ people need to know something about how and
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Limitations of Financial Accounting: Financial accounting is the only branch of accounting and it is not perfect. There are large numbers of limitations which open new way to use other tools of accounting. To know what are the main limitations of financial accounting. It is very necessary for accountants. Accountants are often blind to these limitations. So‚ I am covering its limitation a lot of ground. Read below and understand:- 1. Financial accounting is of historical nature Net effect
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Financial Theories Overview Financial Theories Overview This paper will include an overview of 10 financial theories incorporating both germinal and current research. In addition‚ each financial theory will include a general description‚ current examples‚ and significant attributes. Table 1 Financial Theories Financial Theories | Description | Current Examples | Significant Attributes | 1. Efficiency Theory | Eugene Fama defined efficient markets as “a market where there are large
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earnings quality since net income does not representatively portray the economic performance of the business entity for the period. Income smoothing relies not on falsehoods and distortions but on the wide leeway existing in alternatively accepted accounting principles and their interpretations. It is conducted within the structure of gaap. In effect‚ it redistributes income statement credits and charges among periods. The prime objective is to moderate income variability over the years by shifting
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• Accounting is the system that measures business activities and process information into reports. • Accountant maintain‚ audit and prepare financial records for a person or a company. • Main careers in accounting - bookkeeper‚ auditor‚ financial advisor‚ taxation‚ carbon accountant and accountant etc… • Bookkeeping is recording financial recorders and summaries of financial transaction. Accounting is measuring business activities and process information into reports. • Main professional accounting
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Positive Accounting Theory and Science Md Humayun Kabir Senior Lecturer Faculty of Business Auckland University of Technology Auckland‚ New Zealand Phone: 09 921 9999 E-mail: humayun.kabir@aut.ac.nz ------------------------------------------------------------------------------------------Earlier versions of this paper benefited from comments from Lee Parker of the University of South Australia‚ William Maguire of Manukau Business School‚ Keith Hooper of Auckland University of Technology‚ Divesh
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