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Match Each of the Following Transactions and Events to the Accounting

Question 247

Matching

Match each of the following transactions and events to the accounting principle applicable to recording and reporting them:

Premises:
To make the balance sheet look better, Helen Cho added several thousand dollars to the Equipment account that she believed was undervalued.
A building is for sale at $480,000. An appraisal is given for $450,000.
Helen Cho, a sole proprietor, pays for her daughter's preschool out of business funds.
Mayan Imports receives a shipment from Mexico, which contains an invoice that is stated in pesos.
An insurance company receives insurance premiums for six future months’ worth of coverage.
Responses:
Revenue recognition principle
Monetary unit principle
Cost principle
Objectivity principle
Business entity principle

Correct Answer:

To make the balance sheet look better, Helen Cho added several thousand dollars to the Equipment account that she believed was undervalued.
A building is for sale at $480,000. An appraisal is given for $450,000.
Helen Cho, a sole proprietor, pays for her daughter's preschool out of business funds.
Mayan Imports receives a shipment from Mexico, which contains an invoice that is stated in pesos.
An insurance company receives insurance premiums for six future months’ worth of coverage.
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