Question

ent CALCULATOR i FULL SCREEN PRINTER VERSİON BAO Exercise 4-2 Identify the accounting concept that describes each situation below. Do not use any concept more than once. (a) Is the rationale for why plant assets are not reported at liquidation value. (Do not use the historical cost priniple.) (b) Indicates that personal and business recordkeeping should be separately maintained (c) 、Ensures that all relevant financial information is reported. (d) Assumes that the dollar is the "measuring stick used to report on financial performance. (e) Requires that accounting standards be followed for all items of significant size () Separates financial information into time periods for reporting purposes. (o) Requires recognition of expenses in the same period as related revenues (Ch) Indicates that fair value changes subsequent to purchase are not recorded in the accounts. LINK TO TEXT VIDEO, AmutO SKILLS Question Attempts: o of 3 used SAVE FOR LATE SURHIT ANSWER 閂白 o sear

Answer 1

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Exercise 4.2
		Remarks
a	Going concern assumption	Assumed that business will run forever until there is any seen liquidation plan
b	Economic entity assumption	Business is always considered as separate economy entity from owner
c	Full disclosure principle	Completeness to be ensured
d	Monetary unit assumption	Measurement stick
e	Materiality	Materiality level to be considered
f	Periodicity assumption	To be divided into periods
g	Expense recognition principle	Called matching concept as well. Expenses related to revenue to be recognized in the same period revenue booked
h	Measurement principle (historical cost)	Measurement to be correct
Exercise 4.3
a	Revenue recognition principle	Revenue to be recognized when it is certain what to be sold and at what price
b	Periodicity assumption	Periodic statements not prepared
c	None	Inventory to be reported at Cost or fair value which is lower, which has been done
d	Going concern assumption	assumption is always taken that business will run forever until there is any seen liquidation plan
e	Historical cost principle	Inventory to be reported at Cost or fair value which is lower
f	Economic Entity assumption	Instead of computers, she should have debited Drawing account since Business is always considered as separate economy entity from owner