chapter 2 theory (sentences) Flashcards
(2 cards)
1
Q
define the term source document
A
a source document is a written document that provides details of a business transaction to be recorded in a journal. It serves as an objective and verifiable evidence that a transaction has taken place.
2
Q
explain using an accounting theory why source documents are important
A
source documents are important as they provide evidence that transactions have taken place. this is consistent with the objectivity theory which states that accounting information recorded by business must be supported by reliable and verifiable evidence so that financial statements will be free from opinions and biases.
