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Fundamental Concepts of Accounting

Created by

Trixia Dela Cruz
Trixia Dela Cruz
Philippines

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Fundamental Concepts of Accounting

by Trixia Dela Cruz
1

are the basic rules and assumptions that guide accountants in recording and reporting financial information .

2

A business is treated as a from its owner . This means personal transactions of the owner should not be mixed with business transactions .

3

The means that the business is assumed to be operating in the future . This means it is not expected to close down in the near term .

4

means that assets are recorded at their original purchase price . Even if their market value changes , the recorded amount stays the same .

5

Expenses should be recorded in the same period as the income they helped to earn . When a business earns money , it must also record the costs used to earn that money in the same time period . This is the Principl e

6

In , only transactions that can be measured in money are recorded in accounting .

 
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