Each business is considered a separate entity. Financial data for the business is kept separate from the owners personal financial data. The Cost Principle Assets are valued and recorded according to their actual cost to the business. The Time Period Principle Each company sets and defines an accounting period. The company consistently uses the same time period when it prepares its financial statements. The Matching Principle The costs recorded in the expense accounts should be matched with the revenue of the same accounting period to determine net income. The Principle of Objectivity Accounting records are based on objective evidence. ource documents provide objective evidence to support the value used to record transactions. The Principle of Materiality !nformation that could affect the decisions of users of financial statements must be included when the financial statements are prepared. The Principle of Conservatism "here there are acceptable alternative accounting treatments for an item# accountants choose the one that will result in lower net income and net assets. The Full Disclosure Principle All information needed for a full understanding of a companys financial statements must be included with the financial statements. $e.g. outstanding lawsuits# tax disputes# company takeovers.% The oing Concern Concept The business will continue to operate# unless it is known that it will not. Generally Accepted Accounting Principles Match the definition to the correct GAAP. ! The &atching 'rinciple B The (usiness Entity 'rinciple C The Time 'eriod 'rinciple D The 'rinciple of )bjectivity E The *oing +oncern +oncept !B The 'rinciple of &ateriality !C The 'rinciple of +onservatism !D The +ost 'rinciple !E The Full ,isclosure 'rinciple B Each business is considered a separate entity. Financial data for the business is kept separate from the owners personal financial data. !D Assets are valued and recorded according to their actual cost to the business. C Each company sets and defines an accounting period. The company consistently uses the same time period when it prepares its financial statements. ! The costs recorded in the expense accounts should be matched with the revenue of the same accounting period to determine net income. D Accounting records are based on objective evidence. ource documents provide objective evidence to support the value used to record transactions. !B !nformation that could affect the decisions of users of financial statements must be included when the financial statements are prepared. !C "here there are acceptable alternative accounting treatments for an item# accountants choose the one that will result in lower net income and net assets. !E All information needed for a full understanding of a companys financial statements must be included with the financial statements. $e.g. outstanding lawsuits# tax disputes# company takeovers.% E The business will continue to operate# unless it is known that it will not. (AF-&. /ame0 1111111111111111111111111111111 Generally Accepted Accounting Principles Match the definition to the correct GAAP. ! The &atching 'rinciple B The (usiness Entity 'rinciple C The Time 'eriod 'rinciple D The 'rinciple of )bjectivity E The *oing +oncern +oncept !B The 'rinciple of &ateriality !C The 'rinciple of +onservatism !D The +ost 'rinciple !E The Full ,isclosure 'rinciple """"""""" Each business is considered a separate entity. Financial data for the business is kept separate from the owners personal financial data. """"""""" Assets are valued and recorded according to their actual cost to the business. """"""""" Each company sets and defines an accounting period. The company consistently uses the same time period when it prepares its financial statements. """"""""" The costs recorded in the expense accounts should be matched with the revenue of the same accounting period to determine net income. """"""""" Accounting records are based on objective evidence. ource documents provide objective evidence to support the value used to record transactions. """"""""" !nformation that could affect the decisions of users of financial statements must be included when the financial statements are prepared. """"""""" "here there are acceptable alternative accounting treatments for an item# accountants choose the one that will result in lower net income and net assets. """"""""" All information needed for a full understanding of a companys financial statements must be included with the financial statements. $e.g. outstanding lawsuits# tax disputes# company takeovers.% """"""""" The business will continue to operate# unless it is known that it will not.