71) The amount of cash dividends
declared
during the period and the amount of cash dividends
paid
during the period are reflected in the statement of shareholders' equity and the cash flow statement, respectively.
72) Prior-period adjustments are reported on the income statement for the period in which it is discovered an adjustment is necessary.
73) Corrections to the beginning balance of Retained Earnings for errors found within the current period are called
prior
-
period adjustments.
74) Prior-period adjustments are made when an error occurs in one period and it is corrected in a later period.
75) There is a direct relationship between a company's investment capitalization rate and the risk that the company might not be able to earn a given level of income for the indefinite future; i.e., the higher the risk, the higher the rate, and vice versa.
76) Over long periods of time, a company's net income will equal its net cash flow.
77) Earnings-per-common share is computed for each significant element of net income.
78) When management issues a statement of responsibility, management declares its responsibility for the financial statements and states that they conform to GAAP.
79) Management must issue a statement of responsibility in the company's annual report.
80) Management issues a standard Statement of Management Responsibility shortly after the release of a company's financial statements.