Asked by Cheska Lopez on Jun 15, 2024
Verified
Explain the meaning of:
(a) the objectivity concept
(b) the unit of measure concept
Objectivity Concept
An accounting principle that requires financial and accounting information to be independent and based on measurable and verifiable data.
Unit of Measure
A standard quantity used to express a physical quantity, ensuring uniformity in the reporting of financial and operational data.
- Articulate the importance and implication of key accounting concepts such as objectivity, unit of measure, and the cost concept.
Verified Answer
FA
Fawzia AlmesriJun 18, 2024
Final Answer :
(a) The objectivity concept requires that the amounts recorded in the accounting records be based on objective evidence. In exchanges between a buyer and a seller, both try to get the best price. Only the final agreed-upon amount is objective enough to be recorded in the accounting records.
(b) The unit of measure concept requires that economic data be recorded in dollars. Money is a common unit of measurement for entering financial data and preparing reports.
(b) The unit of measure concept requires that economic data be recorded in dollars. Money is a common unit of measurement for entering financial data and preparing reports.
Learning Objectives
- Articulate the importance and implication of key accounting concepts such as objectivity, unit of measure, and the cost concept.
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