Principle or Assumption M] r those Time period assumption Business entity assumption Expense recognition (matching) principle Going-concern assumption Measurement (cost) principle

Extracted text: Principle or Assumption M] r those Time period assumption Business entity assumption Expense recognition (matching) principle Going-concern assumption Measurement (cost) principle


Extracted text: Identify the accounting principle or assumption that best reflects each situation. Situation 1. Accounting information is based on actual cost. 2. Transactions and events are shown in monetary units. 3. The life of a company can be divided into time periods, and useful reports can be prepared for th periods. 4. Each business is accounted for separately from its owner or owners. 5. A company records the expenses incurred to generate the revenues reported. 6. A company reports details behind financial statements that would impact users' decisions.