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25 Cards in this Set
- Front
- Back
Predictive Value
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Decreases in equity resulting from transfers to owners.
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Relevance
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Pertinent to the decision at hand.
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Timeliness
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Information is available prior to the decision.
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Distribution to owners
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Decrease in equity resulting from transfers to owners.
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Confirmatory value
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Information confirms expectations.
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Understandability
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Users understand the information in the context of the decision being made.
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Gain
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Results if an asset is sold for more than its book value.
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Faithful representation
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Agreement between a measure and the phenomenon it purports to represent.
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Comprehensive income
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The change in equity from nonowner transactions.
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Materiality
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Concerns the relative size of an item and its effect on decisions.
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Comparability
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Important for making interfirm comparisons.
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Neutrality
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The absence of bias.
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Recognition
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The process of admitting information into financial statements.
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Consistency
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Applying the same accounting practices over time.
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Cost effectiveness
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Requires consideration of the costs and value of information.
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Verifiability
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Implies consensus among different measurers.
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Liability
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Obligation to transfer cash or other resources as a result of a past transaction.
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Revenue
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Inflow of an asset from providing a good or service.
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Assets, liabilities and equity
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The financial position of a company.
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Loss
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Sale of an asset used in the operations of a business for less than the asset's book value.
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Equity
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The owners' residual interest in the assets of a company.
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Asset
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An item owned by the company representing probable future benefits.
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Net income
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Revenue plus gains less expenses and losses.
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Investment by owner
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An owner's contribution of cash to a corporation in exchange for ownership shares of stock.
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Expense
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Outflow of an asset related to the production of revenue.
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