Accounting concepts, Accounting Basics

Assignment Help:

Accounting concepts are used in relation to accounting procedures for a specific business enterprise.  Some of these are:

Going concern

Verifiable

Accounting period

Accounting entity

Comparable

Historical cost

Accounting equation

Monetary

Prudence

Timeliness

Materiality

Disclosure

For each statement below, select the most appropriate accounting concept or convention (from the list above) and write your answer in the box next to the description.  Please note the following:

  • Use a concept once only.
  • There are more concepts given than needed.

1     

All relevant information and explanations about a business have been included in its financial reports.

 

2     

This concept results from the need to report profit for a particular, arbitrary period of time.

 

3     

It is customary to consider the business enterprise as separate from the personal affairs of the owner so that profit can be determined.

 

4     

This requires understating rather than overstating income and expense amounts that have a degree of uncertainty, so that financial statements do not overstate the company's financial position.

 

5     

Transactions are recorded using the amount paid (or payable) at the time of the transaction.

 

6     

For an accounting record to be made it must be able to be expressed in dollar terms.

 

7     

The treatment of an item in the financial reports of a business depends on its relevance and importance.

 

8     

This concept implies that financial statements do not represent a company's worth if its assets were to be liquidated, but rather that the assets will be used in future operations.

 


Related Discussions:- Accounting concepts

Balance sheet, A bank statement showed an overdraft of $750. A cheque issue...

A bank statement showed an overdraft of $750. A cheque issued in payment of rent for $570 had not been presented, and a cheque for $624 received was omitted from the statement. The

Assignment 3, Financial accounting reports are mandatory to be prepared by ...

Financial accounting reports are mandatory to be prepared by the firms, and are scrutinized by auditors, creditors or Government or Tax authorities. But management accounting recor

Depreciation, Depreciation on an Motor Vehicle of 5,000,000

Depreciation on an Motor Vehicle of 5,000,000

Recording transactions in a 2 columns journal, began his business with equi...

began his business with equipment valued at $40,000 and place $400,000 in the business checking account. what are the accounts affected?

What is long-term liabilities, Q. What is Long-term liabilities? Long-t...

Q. What is Long-term liabilities? Long-term liabilities are debts such as a bonds payable and mortgage payable that aren't due for more than one year. Companies must show matur

barter transactions, How to create account for barter transactions? As My ...

How to create account for barter transactions? As My Company is providing a service to another company and that company is reimbursing us with his service.

The accounting records of nu-tonics inc., The accounting records of Nu-toni...

The accounting records of Nu-tonics Inc., include the following information for the year ended December 31, 2013:  Materials Inventory as at 1 January 2013 $ 20,000  Materials

Calculate price earnings ratio and payout ratio, Discuss and give reasons w...

Discuss and give reasons why a business would act in a socially responsible manner. Part A:  'Two of the key accounting reports available to users of accounting informati

The qualitative characteristics of relevance and reliability, Maryanne was ...

Maryanne was looking to purchase a local business that sold coal jewelry to tourists along the interstate. The present business owner instructed his accountant, Jane Sane, CPA, to

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd