Chapter 2
Walking Through the Conceptual Framework of Financial Accounting
In This Chapter
Understanding the FASB’s conceptual framework
Highlighting useful framework concepts for your intermediate accounting class
Walking through limits to financial accounting
Thinking about financial accounting principles
Highlighting the three financial statements
Looking at some industries’ special rules to follow
The calculator may seem mightier than the sword, but accountants are beholden to certain rules of practice. They have to follow the rules on their preparation, which are called generally accepted accounting principles (GAAP). GAAP is the law, but every law needs a body to interpret it, and the world of accounting is no exception. The Financial Accounting Standards Board (FASB) is a nonprofit, non-government-affiliated organization that interprets GAAP and sets guidelines and practices ...
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