BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -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-2: -PAT is based on the central economics-based assumption that all individuals’ actions are driven by self-interest and that individuals will always act in an opportunistic manner to the extent that the actions will increase their wealth.

Detailed explanation-3: -❖ Predictive Approach This approach is based on predictive forecasting to take future decisions on the basis of data supplied by accounting. Under predictive approach the principles are formulated taking into consideration the predictive capacity of accounting information.

Detailed explanation-4: -The most commonly used theories are the efficient market hypothesis, the capital asset pricing model, and the discounted cash flow valuation model. When considered from an organizational perspective, accounting research is reductive in scope because each study investigates a specific subset of accounting activity.