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प्रश्न
The retirement of manager of the company cannot be recorded in the book of accounts, because it is not possible to estimate the financial effect of retirement. Which accounting principle would be applicable for the above statement?
विकल्प
The Going Concern Concept
The Business Entity Concept
Money Measurement Concept
The Dual Aspect Concept
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उत्तर
Money Measurement Concept
Explanation:
The Money Measurement Concept states that only transactions and occurrences that may be stated or quantified in monetary terms should be documented in the books of accounts. Even while the retirement of a highly talented manager is a big event that can have a profound impact on a company’s operations, it is a qualitative change whose financial impact cannot be objectively and accurately measured; hence, it must be completely removed from accounting records.
संबंधित प्रश्न
According to this concept, a business firm is treated as a unit separate and distinct from its owners.
On the basis of this concept, only those transactions are recorded in accounts which can be expressed in terms of money.
According to this principle, revenue is deemed to be realised when the goods have been transferred or the services have been rendered to a customer.
“Firms live forever.” Explain with reference to the concept of accounting.
Name the basic principles of accounting.
With reference to the concept of accounting only those transactions are recorded in accounts which can be expressed in terms of money. Justify either for or against.
“Every transaction has two effects.” (with reference to the concept of Accounting). Give a reason either for or against.
Explain Matching Concept of GAAP.
Explain Accounting Period Concept.
Why are Generally Accepted Accounting Principles (GAAP) needed?
