Question: Week 13 Homework (Due in Week 14 Tutorials) 1. Describe the four components of an accounting policy. Illustrate your answer with examples. Differentiate normative accounting

Week 13 Homework (Due in Week 14 Tutorials) 1. Describe the four components of an accounting policy. Illustrate your answer with examples. Differentiate normative accounting theory from positive accounting theory. Provide an example of each. What is an agency relationship? Explain how monitoring costs, bonding costs and residual loss arise in agency relationships. Why would managers' interests differ from those of shareholders? Outline the four agency problems that can arise in the relationship between lenders and managers. What is a debt covenant and why is it used in a lending agreement? ult

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