Relevance Faithful representation Comparability Consistency Monetary unit assump
ID: 2493013 • Letter: R
Question
Relevance Faithful representation Comparability Consistency Monetary unit assumption Economic entity assumption Expense recognition principle Time period assumption Going concern assumption Historical cost principle Full disclosure principle Materiality Match each item above with a description below. Ability to easily evaluate one company's results relative to another's. Belief that a company will continue to operate for the foreseeable future. The judgment concerning whether an item's size is large enough to matter to decision-makers. The reporting of all information that would make a difference to financial statement users. The practice of preparing financial statements at regular intervals. The quality of information that indicates the information makes a difference in a decision. A belief that items should be reported on the balance sheet at the price that was paid to acquire the item. A company's use of the same accounting principles and methods from yExplanation / Answer
1. Comparibility as it is comparying results of 2 companies
2. Going concern assumption as it says company will operate in future
3. Materiality As here a particular item is making difference in decision
4. Full Disclosure Principle As it discloses all items that matter in Financial statement
5. Time period assumption as the financial statements are prepared periodically
6.Relevance As the information quality is making the Difference in statements
7. Historical cost principle as the items are recorded on the basis of price that was paid to acquire them.
8. Consistency As same accounting methods are used from year to year
9. Economic entity assumption as accounts are traced of any company in economy
10. Faithful representation as minimum bais in financial statement is desired
11. Monetary unit assumption as only monetary items are considered .
12. Expense recognition principle As expense are recorded as per the reveues earned.