Accounting Principles

Question 1

Business Entity Principle

Answer 1

a business is separate from its owner

Question 2

Time period principle

Answer 2

financial statements are calendar year or fiscal year

Question 3

Cost principle

Answer 3

all records should be kept in its original price not market value

Question 3

Monetary concept

Answer 3

transaction can only be expressed in terms of money

Question 4

full disclosure principle

Answer 4

disclose everything in the financial statement

Question 5

objectivity principle

Answer 5

should be based on solid evidences (receipts, invoice, contact etc)

Question 6

materiality principle

Answer 6

in case of assets are immaterial (small significant impact) should record it as an expense

Question 7

accurual accounting principle

Answer 7

incurred expenses or revenue should be recorded alreadt