Identify the accounting principle or assumption that best explains each situation. 1. Cruz Consulting performs services for a client. Cruz records revenue this period even though the client is not billed until next period. 2. Stark Company's accounting system maintains the equipment account as if the business will continue operating and not close. 3. Mike Derr owns both Sailing Passions and Dockside Digs. In preparing financial statements for Dockside Digs, Mike makes sure that the expense transactions of Sailing Passions are kept separate from Dockside Digs's transactions and financial statements.

Identify the accounting principle or assumption that best explains each situation. 1. Cruz Consulting performs services for a client. Cruz records revenue this period even though the client is not billed until next period. 2. Stark Company's accounting system maintains the equipment account as if the business will continue operating and not close. 3. Mike Derr owns both Sailing Passions and Dockside Digs. In preparing financial statements for Dockside Digs, Mike makes sure that the expense transactions of Sailing Passions are kept separate from Dockside Digs's transactions and financial statements.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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