Positive Accounting Theory Flashcards Preview

ACCT3321: Financial Accounting-Theory and Practice > Positive Accounting Theory > Flashcards

Flashcards in Positive Accounting Theory Deck (5)
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1
Q

Positive Accounting

A

-explain and predict which firm will and won’t use a particular method

2
Q

Contracting theory

A

organisation is the centre of various contractual relationships

3
Q

Agency Theory

A

monitoring costs to the principal and bonding costs to the agent

4
Q

Owner-manager

A

include horizon problem, risk aversion, dividend retention

5
Q

manager-lender

A

excess divided payouts, under investment, assets substitution and claim dilution