square v square v Identiry which specinc qualitative characteristic or accounting information is best described in each Item pelow. a. The annual financial reports of Treelivingo Corp are audited by public accountants. b. Able Corp. and Mona Inc. both use the straight-line depreciation method. c.Global Corp. issues its quarterly reports within five days after each quarter ends. d. Filipo Inc . segregates information that relates to one of its two subsidiaries which was disposed of in the year but was included in its consolidated statements for prior years. e. The CFO of WebDesign stresses that factual, truthful , unbiased information is the overriding consideration when preparing WebDesign's financial information. f. EB Energy Inc.realizes that financial information may be misrepresented or misinterpreted if all pertinent information is not included. g. Wright Industries exercises due care and professional judgement in developing all estimates and assumptions used to prepare its financial information square v square square Comparability Completeness Feedback value Freedom from material error Neutrality Predictive value Timeliness Understandability eTextbook and Media

Question

square v square v Identiry which specinc qualitative characteristic or accounting information is best described in each Item pelow. a. The annual financial reports of Treelivingo Corp are audited by public accountants. b. Able Corp. and Mona Inc. both use the straight-line depreciation method. c.Global Corp. issues its quarterly reports within five days after each quarter ends. d. Filipo Inc . segregates information that relates to one of its two subsidiaries which was disposed of in the year but was included in its consolidated statements for prior years. e. The CFO of WebDesign stresses that factual, truthful , unbiased information is the overriding consideration when preparing WebDesign's financial information. f. EB Energy Inc.realizes that financial information may be misrepresented or misinterpreted if all pertinent information is not included. g. Wright Industries exercises due care and professional judgement in developing all estimates and assumptions used to prepare its financial information square v square square Comparability Completeness Feedback value Freedom from material error Neutrality Predictive value Timeliness Understandability eTextbook and Media

Answer 1

* **a. Verifiability:** Independent auditors, like public accountants, contribute to the verifiability of financial information. Their audit provides assurance that the information is reliable and can be substantiated by independent parties.* **b. Comparability:** Using the same depreciation method (straight-line) allows for comparison of financial results between Able Corp and Mona Inc. Consistent accounting methods enhance comparability.* **c. Timeliness:** Issuing reports quickly after the end of the quarter enhances the timeliness of the information. Timely information is more relevant for decision-making.* **d. Completeness:** Including information about the disposed subsidiary, even though it's no longer consolidated, contributes to completeness. Users have a fuller picture of the company's past activities.* **e. Neutrality (or Freedom from Bias):** The CFO's emphasis on factual, truthful, and unbiased information reflects the qualitative characteristic of neutrality. Information should be free from bias and represent the economic reality of the situation.* **f. Completeness:** EB Energy's recognition that omitting information can lead to misrepresentation highlights the importance of completeness. All relevant information should be included for a fair presentation.* **g. Freedom from Material Error (and Faithful Representation):** Exercising due care and professional judgment in developing estimates and assumptions aims to minimize errors and ensure the faithful representation of the financial information. This ties into the overall reliability and accuracy of the reports.

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