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Accounting concepts - Coggle Diagram
Accounting concepts
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Accrual Basis
This assumption requires that adjustments are made to some figures in the trial balance before the financial statements can be prepared.
All income and charges relating to the financial period to which the financial statements relate should be taken into account without regard to the date of receipt or payment
Determining the expenses use up to obtain the revenues is referred to as matching expenses against revenues.
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Going Concern
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enables accountants to assume that a business will continue long enough to recover the cost of its assets
Financial statements should be prepared on a going concern basis unless management either intends to liquidate the enterprise or to cease trading, or has no realistic alternative but to do so.
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Historical Cost
emphasizes reliability, and information based on cost is considered objective.
if cash is given for a service, its cost is measured as the amount of cash paid
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