Question Details

Affairs of the business distinguished from those of its owners



Ex. 1—Accounting concepts—matching.
Listed below are several qualitative characteristics, accounting principles and assumptions.  Match the letter of each with the appropriate phrase that states its application.  (Items a through k may be used more than once or not at all.)
	a.	Economic entity assumption	g.	Expense recognition principle
	b.	Going concern assumption	h.	Full disclosure principle
	c.	Monetary unit assumption	i.	Relevance 
	d.	Periodicity assumption	j.	Faithful representation
	e.	Cost principle	k.	Comparability
	f.	Revenue recognition principle

		1.	Stable-dollar assumption (do not use historical cost principle).
		2.	It is probable that future economic benefits will flow to the company and it is possible to reliably measure the amount.
		3.	Presentation of error-free information.
		4.	Yearly financial reports.
		5.	Recording annual depreciation.
		6.	Useful standard measuring unit for business transactions.
		7.	Notes as part of necessary information to a fair presentation.
		8.	Affairs of the business distinguished from those of its owners.
		9.	Business enterprise assumed to have a long life.
		10.	Valuing assets at amounts originally paid for them.
		11.	Application of the same accounting principles as in the preceding year.
		12.	Summarizing significant accounting policies.
		13.	Presentation of timely information with predictive and feedback value.




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