Accounting Assumptions - Accounting Assumptions,...

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Accounting Assumptions, Principles, and Constraints By: Adriana Chairez XACC/280 Dena Green Page 2 Basic accounting assumptions provide a foundation for recording the transactions and preparing the financial statements. That is why there are only 4 basic assumptions and they are: Monetary Unit Assumption: that only the transaction data that can be expressed in terms of money be included in the accounting records. Economic Entity Assumption: That the activities of the entity be kept separate and distinct from the activities of the owner and of all economic entities. Time Period Assumption: That the economic life of a business can divide into artificial time periods. Going Concern Assumption: That the company will continue in operation long enough to carry out its existing objectives, despite numerous business failures. The principles of accounting are recognized as the basic rules to follow when performing any duties required by a company. There also only four of them.
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This note was uploaded on 03/01/2012 for the course ACCOUNTING 280ACC taught by Professor Carmelitaomran during the Spring '10 term at University of Phoenix.

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Accounting Assumptions - Accounting Assumptions,...

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