The same accounting procedure must be followed in the same way in each accounting period.

Financial statements contain all information necessary to understand a business's financial condition.

The revenue from business activities and the expenses associated with earning that revenue are recorded in the same accounting period.

An accounting standard can be ignored if the net impact of doing so has such a small impact on the financial statements that a reader of the financial statements would not be misled.

Business transactions are reported in numbers that have common values—that is, using a common unit of measurement.

Financial statements are prepared with the expectation that a business will remain in operation indefinitely.

GAAP stands for:

The Corona Limited Co. has three plants nationwide that cost a total of P200 million. The current fair value of the plants is P600 million. The plants will be recorded and reported as assets at:

Information is based on actual costs incurred in transactions.

Mr. Philip Pines is the owner of a beauty spa and wellness salon. He bought a residential house and lot which he included in the balance sheet of a beauty spa and wellness salon. This is a violation of accounting principle.

The manager of the business wrote on a piece of paper that utility expenses incurred by the business were paid the amount of P2,222. The bookkeeper asked for the invoice evidencing the payment before recording it in journal.

On June 25, Galing Repair Shop rendered service shop to a client for P600. The service fee was collected July 4. The bookkeeper recorded the revenue on June 25.

Bilis Computer Shop purchased P200 paper puncher. The useful life of paper puncher is 5 years. The bookkeeper expense the entire cost of P200 in the year it is purchased.

Bookkeeping is a detail-oriented career that requires knowledge and skills to do the job correctly.

Failure to keep information confidential could open the door to fraud, identity theft, and other illegal activities if the information is shared with the wrong parties.

A bookkeeper should always present the facts objectively and refrain from slanting information in a misleading way.

A written policy document issued by expert accounting body or body of government or regulatory body covering the aspects of recognition, treatment, measurement, presentation and disclosure of accounting.

These are broad, general statements or “rules” and “procedures” that serve as guides in the practice of accounting

Mrs Do has personal properties of amounting to P3 million pesos. One half of this was invested in the business called Do Laundry Shop and the other half in another business called Do Convenience Store. Two financial reports were prepared by the bookkeeper, one for each business.