What does the concept of objectivity imply for the information reported in financial statements? Why?
Financial statements are written records that show financial positions and the concept of objectivity makes them more reliable and accurate.
Financial statements are defined as written records that show the financial position and financial health of a business.
The concept of objectivity states that the financial statement of a business should be supported by some unbiased evidence rather than opinions or imagination. This concept helps to improve the reliability and verifiability of financial statements of the business.
Key financial figures for Apple’s fiscal year ended September 26, 2015, follow.
Key Figure $ Millions
Liabilities + Equity . . . . . . . . . . . $290,479
Net income . . . . . . . . . . . . . . . . . 53,394
Revenues . . . . . . . . . . . . . . . . . . 233,715
Required 3. How much are total expenses for Apple for the year ended September 26, 2015?
A start-up company often engages in the following transactions during its first year of operations. Classify those transactions in one of the three major categories of an organization’s business activities. F. Financing I. Investing O. Operating
1. Shareholders investing land in business.
2. Purchasing a building.
3. Purchasing land.
4. Borrowing cash from a bank.
5. Purchasing equipment.
6. Selling and distributing products.
7. Paying for advertising.
8. Paying employee wages.
Question: Match each of the numbered descriptions 1 through 5 with the term or phrase it best reflects. Indicate your answer by writing the letter A through H for the term or phrase in the blank provided. A. Audit B. GAAP C. Ethics D. Tax accounting E. SEC F. Public accountants G. Net income H. IASB
1. An examination of an organization’s accounting system and its records that adds credibility to financial statements.
2. Amount a business earns in excess of all expenses and costs associated with its sales and revenues.
3. An accounting area that includes planning future transactions to minimize taxes paid.
4. Accounting professionals who provide services to many clients.
5. Principles that determine whether an action is right or wrong.
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