Question

The cost of stationary is accounted as an expense and not shown as an asset in financial statement. Name the concept.

Answer 1

Answer:

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Explanation:

Financial Accounting both practical and theory-based is built on some accounting principles. There are some accounting equations that support these too. And these accounting principles are built on a few assumptions that we call accounting concepts. These thirteen accounting concepts find wide acceptance across the world by accounting professionals and auditors.

Accounting Concepts

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Accounting Concepts or Principles - 2

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Accounting Concepts or Principles - 1

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1] Business Entity Concept

This accounting concept separates the business from its owner. As far as accounting is concerned the owner and the business are two separate entities. This will help the accountant identify the business transactions from the personal ones. All forms of business organizations (proprietorship, partnership, company, AOP, etc) must follow this assumption.

So for example, if the owner brings in additional capital into the business, we will treat this as a liability on the balance sheet of the business.

2] Money Measurement Concept

This accounting concept states that only financial transactions will find a place in accounting. So only those business activities that can be expressed in monetary terms will be recorded in accounting. Any other transaction, no matter how significant, will not find a place in the financial accounts.

So for example, if the company underwent a major management

Answer 2

Explanation:

rent outstanding is added to rent account which accounting concept