Concepts - Achieved Flashcards

1
Q

What is the definition of Accounting Entity?

A

The financial affairs of the entity are kept separate and distinct from the financial affairs of the owner

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2
Q

What is the definition of Monetary Measurement?

A

Financial transactions must be measured in a common currency such as NZ$ for New Zealand businesses

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3
Q

What is the definition of Reporting Period?

A

The lifetime of the business is divided into nominated time periods of equal length, usually a year

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4
Q

What is the definition of Going Concern?

A

The financial reports are prepared on the assumption that the life of the business is expected to continue to operate into the foreseeable future.

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5
Q

What is the definition of Historical Cost?

A

Transactions are recorded at the amount of cash paid or payable at the time of the transaction

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6
Q

What is the definition of Accrual Basis?

A

Transactions are recognised when they occur and are recorded and reported in the financial reports of the period to which they relate

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