Assignment
Answer each question with a minimum of 175 words.
1. What are at least three International Accounting Standards? Are these standards the same as U.S. standards? Explain your response. Is it necessary to have global standards? Explain your responses. Make sure you are choosing 3 IFRS Standards.
2. Some business decisions that managers could make is when to invest for additional income/revenue. Some tools they will use to make recommendations regarding these business decisions are the financial reports such as the income statement and balance sheet. They would use these tools because it shows where the company is financially. It shows if there are finances available for investments or not. They will measure the success of their recommendations by comparing the annual financial reports from the previous reports.
3. The matching principle is an accrual accounting principle which states that when revenue is recorded an expense related to the revenue must also be recorded in the same period.
Depreciation and Amortization are examples of this. When a company purchases assets these assets are recorded as assets and the expenses is spread out through the life of the asset and expensed. For example, a company buys computers with a five year life. The items are recorded as assets and the expense are recorded by pieces throughout the life of the asset via depreciation. Because an asset will produce revenue in the future in order expense must also must match this revenue.
Provide an example you can think of where this applies.