To Assist with Citation of the Accounting Standards Codification, the FASB

question 20

Multiple Choice

To assist with citation of the Accounting Standards Codification, the FASB created a numerical system that uses which of the following formats?

• A) Topics that track Code section numbers.
• B) Standards with heading numbers based on release date.
• C) Topics identified by a three-digit number between 105-999.
• D) None of the above.

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Definitions:

Statement of Cash Flows

A financial report that provides aggregate data regarding all cash inflows a company receives from its ongoing operations and external investment sources, as well as all cash outflows that pay for business activities and investments during a given period.

Indirect Method

A way of calculating cash flows for operating activities in the cash flow statement by adjusting net income for changes in non-cash items.

Operating Activities

Operating activities involve the day-to-day functions of a business directly related to its provision of goods and services.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.