BACHELOR OF BUSINESS ADMINISTRATION

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BUSINESS ADMINISTRATION

FINANCIAL ACCOUNTING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Overview of Theories of AccountingInductive Theories6. There are several general conditions that Calmers state which can be developed through observation. What are the conditions? i. The number of observations forming the basis of a generalization must be largeii. No accepted observation should conflict with the derived universal lawiii. The observation must not be repeated under a wide variety of conditionsiv. The observation must be repeated under a wide variety of conditions
A
i, ii, iii
B
i, ii, iv
C
i, and ii
D
i, and iv
Explanation: 

Detailed explanation-1: -In accounting, the inductive approach begins by observing the financial information of the companies and progresses towards constructing accounting generalizations and principles out of those observations and re-occurring relations.

Detailed explanation-2: -What is Accounting Theory? An accounting theory is a notion that uses speculations, methodologies, and frameworks in the study of financial reporting (as well as how financial reporting principles are applied in the accounting industry).

Detailed explanation-3: -The main difference between inductive and deductive reasoning is that inductive reasoning aims at developing a theory while deductive reasoning aims at testing an existing theory. In other words, Iinductive reasoning moves from specific observations to broad generalizations.

Detailed explanation-4: -Deductive approach This approach involves developing a theory from elementary proposals, premises and assumptions which results in accounting principles that are reasonable conclusions about the subject.

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