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Unformatted text preview: Accounting 240 Chapter 2 Notes I. Terms A. Primary Objective of External Financial Reporting: is to provide useful economic information about a business to help external parties make sound financial decisions. B. Separate-Entity Assumption: states that business transactions are separate from the transactions of the owners C. Unit of Measure Assumption: states that accounting information should be measured and reported in the national monetary unit D. Continuity (Going Concern) Assumption: states that business are assumed to continue to operate into the foreseeable future E. Assets: are resources with probable future economic benefits owned by the entity as a result of past transactions F. Current Assets: are assets that will be used or turned into cash within the year. Inventory is always considered a current asset regardless of the time needed to produce and sell it...
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This note was uploaded on 04/02/2008 for the course ACC 240 taught by Professor Lewis during the Winter '08 term at Eastern Michigan University.
- Winter '08