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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 an entity using its assets rather than selling them. On the other hand if an entity is liquidating it must use liquidation values to report assets. The economic activity of a business is usually recorded and reported in money terms. Money measurement is the use of a monetary unit such as the dollar instead of physical or else other units of measurement. Using a particular financial unit provides accountants with a common unit of measurement to report economic activity. Without a financial unit it would be not possible to add such items as equipment, buildings and inventory on a balance sheet. Monetary statements identify their unit of measure such as the dollar in the United States so the statement user can make valid comparisons of amounts. For instance it would be hard to compare relative asset amounts or profitability of a company reporting in US dollars with a company reporting in Japanese yen.
Pattillo Industries makes a product that sells for $25 a unit. The product has a $5 per unit variable cost and total fixed costs of $9,000. At budgeted sales of 1,000 units, the
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
If you can earn 4 percent, how much will you have to save each year if you want to retire in 35 years with $ 1 million?
The Bayside Company uses the LIFO cost flow method to value inventory. In the current year, profit at Bayside is running unusually high. The corporate tax rate is also high this ye
An asset or account of borrower, which has been classified by a bank or financial institution as sub-standard, doubtful or loss assets as per the guidelines issued by RBI. An
What is journal entry for Input CST which are paid at the time of purchases of goods from other state.
Which type of error would cause an entry in the suspense account? A. A page total from the purchases journal was posted as $9780 rather than the correct figure of $9870. B. C
Q. Explain about Conservatism? Conservatism The Conservatism means being prudent or cautious and making sure that assets and net income are not overstated. Such overstatements
Q. Explain about realization principle? Realization of revenue Under the realization principle the accountant doesn't recognize (record) revenue until the seller obtains the ri
Q. What is Sales revenues? The sale of goods takes place between two parties. The seller of the merchandise transfers them to the buyer in exchange for cash or a promise to pay
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