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Question #8 There are 4 Accounting Principles. Required: Define (A) Revenue Recognition Principle and (B) Measurement...

Question #8 There are 4 Accounting Principles.

Required: Define (A) Revenue Recognition Principle and (B) Measurement Principle

Homework Answers

Answer #1

A)

Revenue recognition is a generally accepted accounting principle (GAAP) that identifies the specific conditions in which revenue is recognized and determines how to account for it. Typically, revenue is recognized when a critical event has occurred, and the dollar amount is easily measurable to the company.

B)

The measuring principle is a theoretical method for targeting the minimum price of securities for traders. The technique uses technical analysis of historical stock patterns to detect the direction of price movements. Traders hope to find an indication that a stock is ready to move down in price as a buying opportunity. Likewise, they will use the measuring principle to pinpoint upward movements and selling opportunities.

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