Explain Consistency assumption and Revenue Recognition principal of accounting.

Asked by Topperlearning User | 4th Jul, 2016, 08:16: AM

Expert Answer:

 Consistency Assumption: Accounting policies and practices followed by an enterprise should be uniform and consistent over a period of time. However, consistency does allow changes in accounting policies but it should be disclosed.

Revenue Recognition principal of accounting: Revenue is considered as income earned on a particular date when it is realised; say when a transaction has been entered and obligation to receive the amount has been established. 

Answered by  | 4th Jul, 2016, 10:16: AM