Accounting: Tools for Business Decision Making, 5th Edition

Published by Wiley
ISBN 10: 1118128168
ISBN 13: 978-1-11812-816-9

Chapter 2 - A Further Look at Financial Statements - Questions: 16

Answer

1) Materiality and conservatism. 2) Materiality is the statement's impact on company's overall financial condition and operations.

Work Step by Step

1) The two constraints inherent in the presentation of accounting information are materiality and conservatism. 2)Conservatism is choosing the accounting method that will be least likely to overstate the assets or income.
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