Homework answers / question archive / Instructions:For each situation below, identify the assumption, concept of the accounting conceptual framework has been violated, if any and why A

Instructions:For each situation below, identify the assumption, concept of the accounting conceptual framework has been violated, if any and why A

Accounting

Share With

---

Instructions:For each situation below, identify the assumption, concept of the accounting conceptual framework

has been violated, if any and why A. The owner of the supermarket-bought a vehicle for her own use. She paid for the vehicle by writing a cheque on the supermarket account. she instructed the bookkeeper to debit the "Vehicle" account and credit the "Cash at Bank" account of the supermarket for the amount paid for the vehicle.

 

B. The entire cost of a piece of equipment is charged to an expense account in the year the equipment was bought.

 

C. Because profit for the year was extremely small, no entry was done to make an allowance for doubtful debts (taking into consideration potential bad debts).

 

D. A firm had been charging depreciation on a building that is expected to use for 10 years, at the rate of one-twentieth (10%) per annum. In the present year, the current cost of the building increased dramatically. This caused the accountant to double the depreciation expense.