Advertisements
Advertisements
Questions
Define the term GAAP.
What are Generally Accepted Accounting Principles (GAAP)?
Advertisements
Solution
Accounting principles refer to the concepts, conventions and standards which are widely accepted and adopted by accountants while recording and reporting financial information. According to Robert Anthony, "the rules and conventions of accounting are commonly referred to as principles."
Notes
Students should refer to the answer according to their questions.
APPEARS IN
RELATED QUESTIONS
Explain the need for GAAP for accounting.
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?
"Firms live forever." Explain with reference to the concept of accounting.
The capital provided by the owner is a liability of the firm. Answer with reference to the concept of Accounting.
"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 any two basic concepts of accounting.
Why are Generally Accepted Accounting Principles (GAAP) needed?
Explain the expense principle.
Explain the principle of consistency.
