Generally Accepted Accounting Principles

question 47

Multiple Choice

Generally accepted accounting principles

• A) are accounting adaptations based on the laws of economic science.
• B) derive their credibility and authority from legal rulings and court precedents.
• C) derive their credibility and authority from the federal government through the financial reporting section of the SEC.
• D) derive their credibility and authority from general recognition and acceptance by the accounting profession.

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Definitions:

Services

Economic activities offered by one party to another, often involving professional skill, advice, or the performance of tasks in exchange for compensation.

Future Amount

The value of a current asset or amount of money at a specified date in the future, based on expected growth or interest rates.

Accrued Liability

Expenses that have been incurred but not yet paid for, recognized in the financial statements under the accrual basis of accounting.