Source document
a source document that verifies a credit sale of inventory
Sales Invoice
operating
qualitative characteristic that enables the user to identify and understand similarities and differences between items.
Comparability
revenue is recognised in the period in which the expected inflow of economic benefits can be measured in a faithful and verifiable manner; that is, revenue is recognised when it is earned.
accrual basis assumption
are expected to be used by the business entity for a number of years and are not held for resale.
Non-current assets
a source document that verifies a credit purchase of inventory.
Purchase Invoice
cash flow from sale or purchase of non-current assets
investing
the ability to ensure that different knowledgeable and independent observers can reach a consensus that a particular depiction of an event is faithfully represented.
Verifiability
financial reports are prepared on the assumption that an existing entity will continue to operate into the future.
going concern assumption
a present obligation of the entity to transfer an economic resource as a result of past events.
Liabilities
statements provided by a business’s bank that show all cash transactions in and out of a bank account for a specified period.
Bank Statement
cash flow from sources of finance either the owner or bank
financing
that information is available to decision-makers in time to be capable of influence on decisions. Information being available sooner, rather than later,
Timeliness
reports are prepared for a particular period of time, such as a month or a year, in order to obtain comparability of results
period assumption
obligations of the entity that are reasonably expected to be settled within 12 months after the end of the reporting period.
Current liabilities
a special journal that summarises all cash received by the business (from other entities) during a particular reporting period
Cash Receipts Journal
directly assists the user in making decisions
Relevance
financial information to be comprehensible to users with reasonable knowledge of business and economic activities
Understandability
is a present economic resource controlled by an entity as a result of past events
Assets
obligations of the entity that are not required to be settled within 12 months after the end of the reporting period.
Non-current liabilities
a special journal that summarises all cash paid by the business to other entities during a particular reporting period
Cash Payments Journal
the information presented is complete, free from material error, and neutral (without bias).
Faithful representation
the records of assets, liabilities and business activities of an entity are kept completely separate from those of the owner of the entity,
accounting entity assumption
cash and other types of assets held primarily for the purpose of sale or trading, or are reasonably expected to be converted to cash, sold or consumed by a business within 12 months after the end of the reporting period.
Current assets
residual interest in the assets of the entity after deducting all its liabilities.
Owner’s equity