Facts and Information about Accounting

1606 Words Feb 2nd, 2018 6 Pages
How many people know the fundamental accounting concepts? Let me explain briefly some to you. Accounting is a system to identify, measure, record and present the information to the users to help to help make evaluations or financial decisions. There are few general rules and concepts in the accounting field. These general rules and concepts are referring to the basic accounting principles and guidelines. From the basic accounting principles and guidelines, there will affect the balance sheet, income statement and financial statements. Let us discuss to the case study “Smart Business”. 1.1 Qualitative Characteristics of Accounting Information

Diagram 1 : Qualitative characteristics of accounting information
Diagram 1 above is a hierarchy diagram that represents qualitative characteristics of accounting information. Qualitative characteristics of accounting information represent accounting information characteristics that help us to get use of accounting principles. When the financial reports are ready by professional accountants, we need the certain information to represent it. Refer to the diagram 1 qualitative characteristics are divided into two categories. There are primary qualities and second qualities. Primary qualities of accounting information are referring to relevant and reliable. However secondary qualities of accounting information are referring to comparability and consistency.
1.2 Primary qualities of accounting…
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