Generally Accepted Accounting Principles Essay

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Discuss the following;

Entity Concept
The Concept of Going
Principles
Cost Principle
Revenue Recognition Principle
Matching Principle
Materiality Principle
Consistency Principle

 

Here’s a snippet of the essay.

 

Generally Accepted Accounting Principles are the main rules and regulations that control all the accounting activities. They ensure that all accounts and transactions are recorded and kept in a uniform or common way in all organizations and enterprises. There are basic assumptions, principles and constraints in this field (Finkler et.al, 2007). In healthcare practice, organizations are expected to audit their financial records and have them examined yearly by certified public accountants. When this happens, substantial errors are brought out; the organization’s accounting system is evaluated. This examines whether all financial statements are in line with generally accepted accounting principles.

 

Entity Concept

 

This is one area that is considered when accounting. Entities in the field of health care may be whole organizations such as surgical centers or nursing homes. In accounting, resources should be separate from other entities (Frinkler et.al, 2007). Cash or its equivalent to these entities should be of that differentiated entity. For instance, if someone is looking at the finances of a given nursing home, and sees that it has ordered unpaid supplies form a hospital, the school’s record should show an account payable for the supplies.

 

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