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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?
पर्याय
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 the ______ Principle of accounting, transactions are recorded on the assumption that the business will exist for an indefinite period of time.
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.
"The capital provided by the owner is treated as a liability of the firm." Explain the concept on which the above depends.
"Every transaction affects at least three accounts." Comment.
Explain the Dual Aspect Principle.
Write short note on the going concern concept.
Explain the complete disclosure principle.
Explain the revenue principle.
Explain the expense principle.
