unit3

Accounting principles are the essential guidelines under which prepare their financial statements.

• business

• banks

• businesses

• auditors

These principles guide the methods and decisions for a business over a short and term.

• big

• long

• small

• high

For both internal and reporting purposes, it is important to understand the principles of accounting because they serve as guidelines to the analysis of financial reporting issues.

• external

• exported

• imported

• extra

In order to make this language to convey the same meaning to all people, it is necessary that it should be on certain uniform scientifically laid down standards.

• base

• based

• basic

• basically

The matching concept does not mean that revenues and for a period are equal.

• income

• interest

• capital

• expenses

A fair presentation of the results of a firm’s operations during a period of time requires that all expenses incurred in generating that period’s revenues be from the revenues earned.

• deducted

• conducted

• managed

• added

Pending lawsuits, transactions, or other conditions may have imminent and significant effects on the company's financial status.

• complete

• completed

• incomplete

• uncomplete

Footnotes supplement financial statements this information and to describe the policies the company uses to record and report business transactions.

• convey

• conveyed

• conveying

• to convey

The financial statement user relies on these concepts and principles related to the accounting period when making and informed decisions about an entity’s financial position and results of operations.

• judge

• judgments

• judgment

• judged

Accounting principles are the essential guidelines which businesses prepare their financial statements.

• in

• of

• under

• for