Matching Principle
The matching principle requires that expenses be recorded in the same period as the revenues they help generate. This ensures accurate financial reporting by aligning costs with related income. It is a fundamental concept in accrual accounting and improves the comparability and reliability of financial statements.
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Merger Accounting
Merger accounting refers to how the books are consolidated when two companies combine. Depending on the type of merger, acquisition,…
Money Measurement Concept
This accounting concept states that only transactions measurable in monetary terms are recorded in the books. Non-quantifiable events like employee…
Modified Accrual Accounting
Modified accrual accounting blends elements of cash and accrual methods. Commonly used in government and nonprofit entities, it recognizes revenues…
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