BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Business Entity Concept
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Revenue Recognition Concept
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Money Measurement Concept
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Going Concern Concept
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Detailed explanation-1: -Money measurement concept is an important accounting concept that is based on the theory that a company should be recording only those transactions that can be measured or expressed in monetary terms on the financial statement.
Detailed explanation-2: -The monetary unit principle states that business transactions should only be recorded if they can be expressed in terms of a currency. In other words, anything that is non-quantifiable should not be recorded a business’ financial accounts. Over time, money has been adopted as a measurement unit in accounting.
Detailed explanation-3: -Money measurement concept implies that every business transaction must be recorded in common unit of measurement i.e. in terms of money only.
Detailed explanation-4: -2.2 MONEY MEASUREMENT CONCEPT This concept assumes that all business transactions must be in terms of money, that is in the currency of a country.