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Financial & Managerial Accounting
Found in: Page 963
Financial & Managerial Accounting

Financial & Managerial Accounting

Book edition 7th
Author(s) John J Wild, Ken W. Shaw, Barbara Chiappetta
Pages 1096 pages
ISBN 9781259726705

Short Answer

Identify each of the following terms or phrases as either an accounting: (a) principle, (b) assumption, or (c) constraint. 1. Materiality 3. Benefit exceeds cost 2. Time period 4. Revenue recognition.

Constraints in the field of accounting are limitations or the boundaries present for financial statements and the matching is done with relevant terms or phrases.

See the step by step solution

Step by Step Solution

Step 1 : Definition of accounting constraints

Accounting constraints are defined as limitations, boundaries which are present while preparing the financial statements of the company.

Step 2: Matching of terms or phrases with principles/assumptions/constraints

Terms or phrases

Principle/Assumption/Constraint

1 Materiality

Constraints

2 Time period

Assumption

3 Benefit exceeds the cost

Constraints

4 Revenue recognition

Principle

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