Question

Briefly explain the following

i)Objectivity concept

ii) Matching principle​

Answer 1

Answer:

1) OBJECTIVITY CONCEPT: The objectivity principle is the concept that the financial statements of an organization be based on solid evidence. The intent behind this principle is to keep the management and the accounting department of an entity from producing financial statements that are slanted by their opinions and biases.

2) MATCHING CONCEPT: Expenses incurred in an accounting period should be matched with the revenues recognized in that period. eg. if the Revenue is recognized on all goods sold during a period, cost of those goods sold should also be charged to that period.

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