
General Accounting Principle:
This contain the accounting principle generally used in every corporation. This is based on the economic condition of country and differ from one country to another.
Cost Concept: As per this concept actual value of the assets are recorded in the books of accounts. The accountant of the company should always understand the importance of this concept as when payment of asset to the seller occur then only record the transaction.
Business Entity Assumption: The business entity concept means that the business man should record the business transaction and personal transaction separately. Each form of business organization is a separate business entity. So, the accountant will record the personal and business transaction separately.
Revenue Recognition Principle: Revenue recognition principle provide the rules and regulation that should be follow while recognizing the revenue. In accrual basis of accounting the accountant record the transaction of sales when it occur not when the payment against sale is received.
Expense Recognition Principle: As per this accounting principle the expense occur to initiate sales must be recorded in the same accounting period. If the expenses occur not directly relates to the sales period than it should be expense incurred.
Going Concern Assumption: As per this concept the life of the company is not defined. As company is artificial person and the death of company is not possible. If auditor of the company says that the future of company is dark then only the question on existence of company arises.
To identify: The accounting principle or assumption best as per the situation.

Want to see the full answer?
Check out a sample textbook solution
Chapter 1 Solutions
Loose-Leaf for Financial and Managerial Accounting
- What are the budgeted purchases for the first quarter?arrow_forwardHello teacher provide answer with calculationarrow_forwardSummarize the financial components included in the current assets and liabilities section of the Balance Sheet for the given company. Explain why the balance sheet is arranged the way it is. Determine if the same asset or liability can have both short-term and long-term components and provide your rationale. Explain how variances in data can be detected for current assets and liabilities using relevant tools. Justify why footnotes for current assets and liabilities are important in decision making for the company. Include the following details in your response: Explain why the balance sheet amounts alone are not sufficient in providing the information needed in decision making. Explain why FIFO is the best choice for this given company. Cite the applicable FASB codification section for the following items as a list: cash and cash equivalents, inventory, and receivables.arrow_forward
- Choice best answer wantedarrow_forward4 PTSarrow_forwardMarin, Inc. had the following bank reconciliation at March 31, 2025: Balance per bank statement, 3/31/25 Add: Deposit in transit $82000 22200 104200 Less: Outstanding checks 26600 Balance per books, 3/31/25 $77600 Data per bank for the month of April 2025 follow: Deposits $86200 Disbursements 96600 All reconciling items at March 31, 2025 cleared the bank in April. Outstanding checks at April 30, 2025 totaled $15000. There were no deposits in transit at April 30, 2025. What is the cash balance per books at April 30, 2025? ○ $56600 Ⓒ $67200 ○ $71600 ○ $78800arrow_forward
- On January 1, Crestview Finance lends a corporate client $195,000 at an annual interest rate of 6.8%. What is the amount of interest revenue that should be recorded for the quarter ending March 31?arrow_forwardI need help solving this General accounting question with the proper methodology.arrow_forwardI am looking for the most effective method for solving this financial accounting problem.arrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education





