In Establishing Financial Accounting Standards, "Due Process" Refers to

question 18

Multiple Choice

In establishing financial accounting standards, "due process" refers to

• A)the process of giving interested parties ample opportunity to express their views.
• B)the practice of researching, creating a task force, issuing an exposure draft and establishing the new GAAP.
• C)the researching of the legal implications of proposed new accounting standards.
• D)the requirement that all accountants must receive a copy of financial standards.

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Definitions:

Operating Activities

Transactions and events that affect the net income of a business.

Investing Activities

Deals related to buying and selling assets with a long-term horizon and different kinds of investments, excluding those similar to cash.

Stockholders' Equity

The residual interest in the assets of a corporation that remains after deducting its liabilities, essentially representing the ownership equity held by stockholders.

Balance Sheet

A financial statement that provides a snapshot of a company's financial condition at a particular moment in time, showing assets, liabilities, and shareholders' equity.