ACCT 512

Questions pertaining to the Dichev (2008) and Miller and Bahnson (2010) articles:

1.In the journal article On the Balance-Sheet Based Model of Financial Reporting, Ilia Dichev states that the "so-called balance sheet approach to financial reporting...views the proper valuation of assets and liabilities the primary goal of financial reporting with the determination of other accounting variables [including those reported on the income statement] as secondary and derivative." How would an advocate of the asset/lability view respond to this statement?

2.In defending 'revenue/expense theory', Dichev praised Payton and Littleton's book, An Introduction to Corporate Accounting Standards, referring to it as the "accounting book of the century." According to Miller and Bahnson (2010), what are the limitations of Dichev's use of this book to support revenue/expense theory?

3.Compare and contrast Dichev's view regarding the balance sheet-based model of financial reporting and financial statement volatility with Miller and Bahnson's perspective regarding the asset/liability model and financial statement volatility.