Accrual accounting information is conceptually more relevant than cash flows. Describe empirical findings that support this superiority of accrual accounting.
Answer to relevant QuestionsAccrual accounting information, cash flow information, and analysts’ forecasts are information for investors. Compare and contrast each of these sources in terms of relevance and reliability.Explain how accounting principles can, in certain cases, create differences between financial statement information and economic reality.Explain how estimates and judgments of financial statement preparers can create differences between financial statement information and economic reality.What is the relation between the reported value of assets and reported earnings? What is the relation between the reported values of liabilities, including provisions, and reported earnings?Describe the criteria necessary for a business to record revenue.
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