Financial accounting information is reported in accordance with the accounting standards. The accounting standards represent a set of principles generally accepted by the accounting profession
The Conceptual Framework for Financial Reporting jointly issued by the IASB and FASB defines the relevance and faithful representation as the primary characteristics of useful
Financial statements are prepared based on the following underlying assumptions: Economic entity assumption Business operations can be reported for an entity which is separate from
Accounting information is communicated in the form of financial statements. Financial statements include the following: Balance Sheet (Statement of Financial Position) Income Statement (Statement of
The elements of balance sheet are assets, liabilities and equity. The elements of income statement are revenues and expenses. Assets Assets represent the items that
Three common forms of business organizations are sole proprietorship, partnership and corporation. Sole proprietorship is owned and managed by one person. Partnership has more than