Accounting concepts and conventions

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Accounting concepts

These are the basic assumptions or ideas upon which the science of accounting is based. These are fundamentals to accounting practice. These include:

1. Separate Entity Concept
2. Going Concern Concept
3. Money Measurement Concept
4. Cost Concept
5. Dual Aspect Concept
6. Accounting Period Concept
7. Matching Concept
8. Realization concept

Accounting Conventions

The term “Accounting Conventions” includes those customs and traditions which guide the accountants to prepare accounting statements. Following are some important conventions:

1. Convention of Conservatism
2. Convention of Consistency
3. Convention of Materiality
4. Convention of Full disclosure