Accounting Principles

Question 1

Transactions are recorded when it occurs, not when cash comes in

Answer 1

Accural Principle

Question 2

Accounting methods are applied across reporting periods for comparability

Answer 2

Consistency Principle

Question 3

Assumes business will continue in the future

Answer 3

Going Concern Principle

Question 4

Expenses are recorded in the same period as revenue

Answer 4

Matching Principle

Question 5

Revenue is recognized when earned

Answer 5

Revenue Recognition Principle

Question 6

Assets are recorded at original purchase cost

Answer 6

Cash Principle

Question 7

All relevant financial information should be disclosed in the financial statements

Answer 7

Full Disclosure Principle

Question 8

Financial statements are based on objective and verifiable evidence

Answer 8

Objectivity Principle

Question 9

Only information that would influence the decision-making process should be reported

Answer 9

Materiality Principle

Question 10

Report expenses and liabilities sooner and recognize revenues and assets letter to avoid overstatement

Answer 10

Conservation Principle