explain and answer all the equation in couple of sentences per question (not topic ) FASB and Standard Setting 1.Describe the role of the Financial Accounting Standards Board. 2. Describe the primary purpose of financial reporting.Accrual Accounting1.List the components of an external financial report. 2. Define accruals and deferrals and give examples of each.Financial Accounting Standards Codification1.Describe the goals and purpose of the Codification. 2. Identify the main areas of the Codification.Conceptual Framework of Financial Reporting by Business Enterprises1.Describe the objective of financial reporting. 2. Describe the qualitative characteristics of accounting information.Assumption and Accounting Principles1.List and describe the assumptions in the conceptual framework. 2. List and describe the principles in the conceptual framework.Constraint and Present Value1. List and describe the constraints in the conceptual framework. 2. Describe how cash flow and present value are used in accounting measurements.Fair Value Framework1. Define “fair value” for accounting purposes.2. Describe the individual components of the fair value definition and how each component impacts the application of the definition.Inputs and Hierarchy1.Distinguish between observable and unobservable inputs in determining fair value. 2. Describe the three levels of the fair value hierarchy and give examples of each.Disclosure Requirements 1 Describe significant disclosures required for assets, liabilities, and equity items measured at fair value on a recurring basis.2. Describe significant disclosures required for assets, liabilities, and equity items measured at fair value on a nonrecurring basis.Balance SheetIdentify the measurement bases used to measure the items on the Balance Sheet. 2. Distinguish between a current and noncurrent asset or liability.Income Statement 1.List and define the components of the Income Statement. 2. Identify the difference between economic income and accounting income.Statement of Comprehensive Income1.Define “comprehensive income.”2.List the components of other comprehensive income.Statement of Changes in Equity1.Identify the components included in the Statement of Owners’ Equity.2.Construct a Statement of Owners’ EquityStatement of Cash Flows -Sources and Uses of Cash1.Describe the purpose of a Statement of Cash Flows.2.Define and identify cash equivalents and restricted cash.Operating, Investing, and Financing Activities1.Distinguish what items are included in cash flows from operations using the direct method.2. Distinguish what items are included in cash flows from investing activities.Operating Cash Flows – Indirect Method1. Construct the operating section on the Statement of Cash Flows using the indirect method.2. Evaluate the similarities and differences in the Statement of Cash Flows under the direct and indirect methods.