Which of the following should be disclosed in a Summary of Significant Accounting Policies?
A) Types of executory contracts
B) Amount for cumulative effect of change in accounting principle
C) Claims of equity holders
D) Depreciation method followed

Question

Quizplus · Accepted Answer

The Summary of Significant Accounting Policies should include information about the methods used to account for significant items, such as depreciation. A is incorrect because executory contracts are typically disclosed in the notes to the financial statements rather than in the Summary of Significant Accounting Policies. B is incorrect because the amount for cumulative effect of change in accounting principle is typically disclosed in the footnotes, not in the Summary of Significant Accounting Policies. C is incorrect because information about claims of equity holders is typically disclosed in the equity section of the balance sheet, not in the Summary of Significant Accounting Policies.

Which of the Following Should Be Disclosed in a Summary