Midterm Quiz 2 - Part 1

This refers to a set of logical ideas and procedures that guide the accountant in recording and communicating economic information.

Under this concept, the business is treated separately from its owners. Therefore, only the transactions of the business are recorded in the accounting books.

Under this concept, assets are initially recorded at their acquisition cost.

Under this concept, the business s assumed to continue to exist for an indefinite period of time.

Under this concept, some costs are initially recognized as assets and recognized only as expenses when the related revenue is recognized.

This concept is an offshoot of the time period concept.

Under this concept, the accountant observes some degree of caution when exercising judgments needed in making accounting estimates under conditions of uncertainty.

Under this concept, the life of the business is divided into series of reporting periods.

This concept guides the accountant when applying accounting principles.

This concept is related to both the concepts of materiality and cost-benefit.