ACCCOB1 Accounting Principles Questions With Answers Verified 100%

ACCCOB1 Accounting Principles Questions With Answers Verified 100% GAAP - ANSWER Generally Accepted Accounting Principles. The standards and rules that accountants follow while recording and reporting financial activities. It encompasses the procedures accepted in the accounting process. IASB - ANSWER International Accounting Standards Board. They actively develop and issue accounting standards that will to be followed internationally. Its purpose is to narrow down the differences in the world when preparing a financial statement. Conceptual Framework of Financial Reporting - ANSWER 1. Underlying Assumption a. Entity principle b. Going concern c. Monetary Unit d. Time Period 2. General Principles a. Historical cost principle b. Revenue recognition principle c. Matching principle d. Accrual basis principle e. Full disclosure principle 3. Modifying Constraints a. Materiality b. Cost-benefit analysis c. Conservatism d. Industry practice 4. Qualitative Characteristics a. Usefulness b. Understandability c. Relevance d. Reliability e. Neutrality f. Comparability g. Consistency Underlying Assumptions - ANSWER 1. Entity concept 2. Going concern 3. Monetary Unit 4. Time Period General Principles - ANSWER 1. Historical cost principle 2. Revenue recognition principle 3. Matching principle 4. Accrual basis principle 5. Full disclosure principle Modifying Constraints - ANSWER 1. Materiality 2. Cost-benefit analysis 3. Conservatism 4. Industry practice Qualitative Characteristics - ANSWER 1. Usefulness 2. Understandability 3. Relevance 4. Reliability 5. Neutrality 6. Comparability 7. Consistency Entity Concept - ANSWER A business or an organization and its owners are treated as two separate parties. Establishes boundaries in what should be recorded in the financial statements of the business. Going Concern / Continuity Assumption - ANSWER States that businesses are assumed to continue to operate into the future unless there is an evidence that the business will not continue to operate. Going concern will then become liquidating concern. Monetary Unit Concept - ANSWER Only transactions and events that are capable of being measured in monetary terms are recognized in the financial statements. Time Period or Periodicity Concept - ANSWER States that recent accounting