Consistency in accounting principle, Accounting Basics

Assignment Help:

Q. Consistency in accounting principle?

Consistency necessitates that a company use the same accounting principles and reporting practices through time. Consistency makes possible comparability of financial information for a single company through time. Comparability between companies is more complicated because they may account for the same activities in different ways. For instance Company B may perhaps use one method of depreciation while Company C accounts for an identical asset in similar circumstances using another method. A high degree of inter-company comparability in accounting information doesn't exist unless accountants are required to account for the same activities in the same manner across companies and through time.

Accountants should consider one pervasive constraint and one threshold for recognition in providing useful information. First the benefits secured as of the information must be greater than the costs of providing that information. Second only material items require be disclosed and accounted for strictly in accordance with generally accepted accounting principles (GAAP).


Related Discussions:- Consistency in accounting principle

Explain about closing process, Q. Explain about closing process? Expens...

Q. Explain about closing process? Expense, revenue and dividends accounts are nominal (temporary) accounts that are merely sub classifications of a real (permanent) account Ret

Retiring partner, what all things do we have to treat in revaluation accoun...

what all things do we have to treat in revaluation account

CIS 180, Start in cell E3. Complete the series of substitution values rangi...

Start in cell E3. Complete the series of substitution values ranging from 5 to 15 at increments of 1, vertically down column E.

What do you mean by inventory turnover, Q. What do you mean by Inventory tu...

Q. What do you mean by Inventory turnover? Inventory turnover -- a ratio which indicates amount of inventory a company uses tosupport a given level of sales. Formula is: Invent

Calculate the share price, Cooperton Mining just announced it will cut its ...

Cooperton Mining just announced it will cut its dividend from $4 to $2.50 per share and use the extra funds to expand. Prior to the announcement, Cooperton's dividends were expecte

Show money measurement, Accountants frequently cite the going-concern assum...

Accountants frequently cite the going-concern assumption to justify using historical costs rather than market values in measuring assets. Market values are of less implication to a

What is evaluated receipt settlement, ERS is a business process among tradi...

ERS is a business process among trading partners that conduct commerce without invoices. In an ERS transaction the supplier ships goods based upon an Advance Shipping Notice (ASN)

What is payroll?, Payroll implies with paying your employees (having seeing...

Payroll implies with paying your employees (having seeing that the government gets the monies they require you to withhold from the employees and the payroll taxes they needs you t

Efficiency variances , Jackson Corporation uses a standard cost system, con...

Jackson Corporation uses a standard cost system, concerned manufacturing overhead on the basis of machine hours. The company's overhead standards per unit are given below. Varia

What is variable cost, Q. What is Variable cost? Variable cost -- a cos...

Q. What is Variable cost? Variable cost -- a cost which changes as production or sales change. If a business is producingnothing and selling nothing, variable cost must be zero

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