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Question
Name the basic principles of accounting.
Solution
The basic principles of accounting are given below.
- The Business Entity Concept
- The Going Concern Concept
- Money Measurement Concept
- Accounting Period Concept
- The Matching Principle
- The Dual Aspect Principle
- The Complete Disclosure Principle
- The Revenue Principle
- The Expense Principle
- The Realisation Principle
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RELATED QUESTIONS
Justify the following:
Every transaction is recorded in at least three accounts.
Define the term GAAP.
Accounting principles are necessary due to which of the following reasons?
On the basis of this concept, only those transactions are recorded in accounts which can be expressed in terms of money.
This concept assumes that the business will continue to exist for a long time in the future.
It is due to this concept that financial statements are prepared at regular intervals, generally one year.
According to Business Entity Concept:
Accounts should disclose all material information (with reference to the concept of accounting). Justify either for or against by giving two reasons.
Discuss in brief the basic principles of accounting.
Explain the principle of consistency.
