FAC1502 UNIT 1 BASIC Principles OF
Accounting FINAL PAPER Questions and
Answers Verified Solutions Latest
Update
Question:
Full Disclosure Principle
Answer:
Financial statements contain all information necessary to understand a business'
financial condition.
Question:
Business Entity Principle
Answer:
Financial information is recorded and reported separately from the owner's personal
financial information. Accounts are kept for entities and not the people who own or run
the company.
Question:
Consistent Reporting Principle
Answer:
The same accounting procedures must be followed in the same way in each accounting
period. Once an entity decides on one method of reporting (i.e. a method of calculating
depreciation), it must use that same method for subsequent events.
Question:
Going Concern Assumption Principle
Answer:
Financial statements are prepared with the expectation that a business will remain in
operation indefinitely.
Accounting FINAL PAPER Questions and
Answers Verified Solutions Latest
Update
Question:
Full Disclosure Principle
Answer:
Financial statements contain all information necessary to understand a business'
financial condition.
Question:
Business Entity Principle
Answer:
Financial information is recorded and reported separately from the owner's personal
financial information. Accounts are kept for entities and not the people who own or run
the company.
Question:
Consistent Reporting Principle
Answer:
The same accounting procedures must be followed in the same way in each accounting
period. Once an entity decides on one method of reporting (i.e. a method of calculating
depreciation), it must use that same method for subsequent events.
Question:
Going Concern Assumption Principle
Answer:
Financial statements are prepared with the expectation that a business will remain in
operation indefinitely.
