(a)
Accounting assumptions: These are the conventions which guide FASB (Financial Accounting Standards Board) to develop accounting standards. The basic assumptions are monetary unit assumption, economic entity assumption, periodicity assumption, and going concern assumption.
Accounting principles: These are the rules which guide FASB to prepare guidelines necessary for reporting the accounting formation, in a useful and relevant format which is better understood by the users. Some basic principles are historical cost principle, fair value principle, and full disclosure principle.
To identify: The accounting assumptions and principles that were violated by Company L, and explain what the company actually should have done.
(b)
To identify: The accounting assumptions and principles that were violated by Company L, and explain what the company actually should have done.
(c)
To identify: The accounting assumptions and principles that were violated by Company L, and explain what the company actually should have done.

Want to see the full answer?
Check out a sample textbook solution
Chapter 2 Solutions
Financial Accounting: Tools for Business Decision Making, 8th Edition
- I mistakenly submitted blurr image please comment i will write values. please dont Solve with incorrect values otherwise unhelpful.arrow_forwardI need help solving this general accounting question with the proper methodology.arrow_forwardCan you solve this general accounting problem using appropriate accounting principles?arrow_forward
- The installation of a ______ system will create confidence in the minds of public about the fairness of the prices charged. a. Costing b. Financial accounting c. Management accounting d. Informationarrow_forwardsub general acoountingarrow_forwardPlease provide the solution to this general accounting question with accurate financial calculations.arrow_forward