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Current Issue In Accounting (Accounting Theory) - Essay Example
Author : elva97
Finance & Accounting
Pages 7 (1757 words)
Current Issue in Accounting (Accounting Theory) Name Instructor Task Date Outline i. Introduction ii. Part A: Measurement in Accounting Theory iii. Measurement models a. Historical cost Advantages of Historical cost Disadvantages b. Net Realizable Value c…
Accounting is considerably a measurement tool since it assesses the value and returns of the company in comparison to the costs. The measurement of fair values (FV) of assets is inclusive of numerous aspects, for example, market risk or credit risk. According to Schroeder, Clark & Cathey (2010) the U.S GAAP standards differ in specificity of the valuation models. Some corporations determine the fair value (FV) of their assets and liabilities as a net amount, and not them in their singularity. The Financial Accounting Standards Board (FASB) emphasizes that is imperative for corporations to associate their measurements on their business strategy approach (Schroeder, Clark & Cathey 2010). Part A: Measurement in Accounting Theory Measurement of financial statements encompasses the inclusion of accounting principles that will establish the true worth of the corporation of item (Schroeder, Clark& Cathey 2010). Some of the regulators of financial institutions argue that measurement of all financial instruments can generate predicaments in assessing the true value of the commodities. As such, measurement in accounting entails a collection of theories that conform to particular items but not a general formula. ...
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