According to the FASB,the usefulness of accounting is judged by which of the following two prime qualitative characteristics of accounting information?
A) Timeliness and understandability
B) Understandability and relevance
C) Verifiability and faithful representation
D) Relevance and faithful representation

Question

Quizplus · Accepted Answer

The prime qualitative characteristics of accounting information according to FASB are relevance and faithful representation. Relevance means information that is capable of making a difference in the decisions made by users. Faithful representation means information that is complete, neutral, and free from error. These two characteristics are essential for accounting information to be useful to its users. Timeliness, understandability, and verifiability are also important characteristics, but they are secondary to relevance and faithful representation.

According to the FASB,the Usefulness of Accounting Is Judged by Which