Wild3edchonesolutions - Code Description Principle or...

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Code Description Principle or Assumption E 1. Usually created by a pronouncement from an authoritative body. Specific accounting principle G 2. Financial statements reflect the assumption that the business continues operating. Going-concern assumption A 3. Derived from long- used and generally accepted accounting practices. General accounting principle C 4. Every business is accounted for separately from its owner or owners. Business entity assumption D 5. Revenue is recorded only when the earnings process is complete. Revenue recognition principle B 6. Information is based on actual costs incurred in transactions. Cost principle F 7. A company reports details behind financial statements that would influence users' decisions. Full disclosure principle H 8. A company records the expenses incurred to generate the revenue reported. Matching principle
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Exercise 1-5 below a. Sole proprietorship e. Corporation b. Corporation f. Partnership c. Sole proprietorship g. Sole proprietorship d. Corporation Exercise 1-6 Assets = Liabilities + Equity (a) $180,000 = $164,000 + $16,000 $ 90,000 = $ 39,000 + (b) $51,000 $201,000 = (c) $139,000 + $62,000 Exercise 1-8 Using the accounting equation: Assets = Liabilities + Equity $137,000 = $110,000 + ? Thus, equity = $27,000
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Wild3edchonesolutions - Code Description Principle or...

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