Chapter 01 - Exercise 1-2 Code Description 1 Usually...

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Exercise 1-2 Code Description Principle E 1. Usually created by a pronouncement from an authoritative body. Specific accounting principle G 2. Requires financial statements reflect the assump-tion that the business continues operating. Going-concern principle A 3. Derived from long-used and generally accepted accounting practices. General accounting principle F 4. Requires financial statement information to be supported by evidence other than someone’s opinion or belief. Objectivity principle C 5. Requires every business to be accounted for separately from its owner or owners. Business entity principle D 6. Requires revenue to be recorded only when the earnings process is complete. Revenue recognition principle B 7. Requires information to be based on actual costs incurred in transactions. Cost principle
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Exercise 1-12 Cash + Accounts Receivable + Equip- ment = Accounts Payable + Maben, Capital - Maben, With- drawals + Revenue - Expenses a. +$50,000 + $10,000 = + $60,000 b. 1,600 ______ ______ $1,600 Bal. 48,400 + + 10,000 = + 60,000 1,600 c. _______ + 12,000 +$12,000 ______ _____ Bal. 48,400 + + 22,000 = 12,000 + 60,000 1,600 d. + 2,000 ______ _______ ______ + $2,000 _____ Bal. 50,400 + + 22,000 = 12,000 + 60,000
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