Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
The resources as machinery, property, buildings and land rights etc. such a business owns are termed as assets. The money values allocated to assets are derived from the cost concept. Such concept states that a benefit is worth the price paid for, or cost incurred to obtain it. Hence, assets are recorded as per their original purchase price and this cost is the origin for each subsequent accounting for the asset. The assets demonstrated on the financial statements do not essentially indicate their present market worth or market values. It is contrary to what is frequently believed through an uninformed person reading the report or statement. The term 'book value' is utilized for the amount demonstrated in the accounting records.
In the case of specific assets, the accounting values and market values might be same; cash is an obvious illustration. In general, the longer an asset has been owned through the company the less, are the chances such accounting value will correspond to the market value.
The cost concept does not imply that all assets continue on the accounting records at their original cost for always to come. The cost of an asset which has a long but restricted life is systematically decreased throughout its life by a process termed as 'depreciation' that will be discussed at several lengths in a subsequent unit. Suffice it to imply that depreciation is a process through which the cost of the asset is slowly reduced or written off through allocating a part of it to expense in all accounting period. It will have the effect of decreasing the profit of every period. In charging depreciation the intention is not to modify depreciation identical to the fall in the market value of the asset. While, there is no association among depreciation and changes in market value of the assets. The reason of depreciation is to assign the cost of an asset over its helpful life and not to adjust its cost in order to bring it closer to the market value.
The major argument is that the cost concept meets all the three fundamental criteria of relevance, feasibility and objectivity.
most consrvatism way of lower cost method
Q. What is accrual basis of accounting? In the following illustration, notice that every business transaction affects two or more accounts in the ledger. As well note that
1. An accountant records a transaction when cash is paid or received under which basis of accounting? cash deferred accrual liability 2. When unearned revenue is initially rec
Please use the following information to answer questions 4-5: Cash $10,000 Accounts Payable $7,000 Accounts Receivable $6,400 Mortgage Payable $65,000 Supplies $1,500 Long-
Q. Cash collection as point of revenue recognition? Several small companies record revenues and expenses at the time of cash collection and payment which may not take place at
Explain the term- Depreciation This is a term which is used to describe the expense which results from loss of usefulness of an asset because of age, wear and tear, and obsoles
I am looking for job in your company. I possess academic writing experience of 1.5 years in accounting field.
Q. Explain accounting cycle? Creditors, Investors as well as Managers use these statements in evaluating management's past decisions and as a basis for making future decisions.
Accounting is frequently termed as the language of business. The fundamental function of any language is to function like a means of communication. In this circumstance, the reason
You have been assigned to analyze the costs of NC Microelectronics, a microchip manufacturer. Indicate whether the following costs are more likely fixed (F), variable (V), or mixed
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd