Accounting Concepts Question Preview (ID: 1454)


Identify The Correct Accounting Concept.

Which accounting concept states that the same accounting procedures are followed in the same way in each accounting period?
a) Adequate Disclosure
b) Realization of Revenue
c) Historical Cost
d) Consistent Reporting

Which concept states that revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period?
a) Historical Cost
b) Matching Expenses with Revenue
c) Adequate Disclosure
d) Unit of Measurement

Which concept states that changes in financial information are reported for a specific period of time in the form of financial statements.
a) Accounting Period Cycle
b) Going Concern
c) Adequate Disclosure
d) Consistent Reporting

Which concept states that a source document is prepared for each transaction?
a) Accounting Period Cycle
b) Business Entity
c) Adequate Disclosure
d) Objective Evidence

Which concept states that business transactions are stated in numbers that have common values?
a) Unit of Measurement
b) Realization of Revenue
c) Historical Cost
d) Going Concern

Which concept states that financial information is recorded and reported separately from the owner's personal financial information?
a) Adequate Disclosure
b) Business Entity
c) Consistent Reporting
d) Historical Cost

Which concept states that revenue is recorded at the time goods or services are sold?
a) Objective Evidence
b) Business Entity
c) Realization of Revenue
d) Historical Cost

Which concept states that financial statements contain all information necessary to understand a business's financial condition?
a) Adequate Disclosure
b) Consistent Reporting
c) Historical Cost
d) Realization of Revenue

Which concept states that financial statements are prepared with the expectation that a business will remain in operation indefinitely?
a) Consistent Reporting
b) Objective Evidence
c) Going Concern
d) Matching Expenses with Revenue

Which concept states that the actual amount paid for merchandise or other items bought is recorded?
a) Historical Cost
b) Unit of Measurement
c) Adequate Disclosure
d) Matching Expenses with Revenue

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