Opportunities for influencing the outcome of reported earnings- Please.docx
Opportunities for influencing the outcome of reported earnings. Please elaborate a. accounting choices, estimates and judgements b. changes in accounting methods and assumptions c. discretionary expenditures d. revenue and expenses Solution a.) The method by which income and expenses are reported for taxation purposes. The Internal Revenue Service requires taxpayers to choose an accounting method that accurately reflects their income and to be consistent in their choice of accounting method from year to year. IRS approval is required to change methods. The chosen accounting method is based on regulation and tax minimization strategies. The two primary accounting methods in North America are cash and accrual accounting. Cash accounting reports income and expenses in the year they are received and paid; accrual accounting reports income and expenses in the year they are earned and incurred. Cash, accrual, special and hybrid methods are all allowable choices if specified requirements are met. Accounting Estimates- Financial statements provide investors and analysts with information about a company .
Opportunities for influencing the outcome of reported earnings- Please.docx
Opportunities for influencing the outcome of reported earnings. Please elaborate a. accounting choices, estimates and judgements b. changes in accounting methods and assumptions c. discretionary expenditures d. revenue and expenses Solution a.) The method by which income and expenses are reported for taxation purposes. The Internal Revenue Service requires taxpayers to choose an accounting method that accurately reflects their income and to be consistent in their choice of accounting method from year to year. IRS approval is required to change methods. The chosen accounting method is based on regulation and tax minimization strategies. The two primary accounting methods in North America are cash and accrual accounting. Cash accounting reports income and expenses in the year they are received and paid; accrual accounting reports income and expenses in the year they are earned and incurred. Cash, accrual, special and hybrid methods are all allowable choices if specified requirements are met. Accounting Estimates- Financial statements provide investors and analysts with information about a company .
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Opportunities for influencing the outcome of reported earnings- Please.docx
- 1. Opportunities for influencing the outcome of reported earnings. Please elaborate a. accounting choices, estimates and judgements b. changes in accounting methods and assumptions c. discretionary expenditures d. revenue and expenses Solution a.) The method by which income and expenses are reported for taxation purposes. The Internal Revenue Service requires taxpayers to choose an accounting method that accurately reflects their income and to be consistent in their choice of accounting method from year to year. IRS approval is required to change methods. The chosen accounting method is based on regulation and tax minimization strategies. The two primary accounting methods in North America are cash and accrual accounting. Cash accounting reports income and expenses in the year they are received and paid; accrual accounting reports income and expenses in the year they are earned and incurred. Cash, accrual, special and hybrid methods are all allowable choices if specified requirements are met. Accounting Estimates- Financial statements provide investors and analysts with information about a company