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E-book Module 1 : Accounting an Introduction
Accounting policies are the specific principles, bases, conventions, rules and practices applied by a business in preparing its financial statements. An example would be changing from one basis of assigning cost to inventory to another. The impact of events on assets and liabilities is recognised (recorded) in the accounting records in the period when the service is rendered or the sale (revenue) is earned and the expenses are recognised when incurred (also known as the matching principle).
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