What is (GAAP) generally accepted Accounting Principle

Today our topic is what is GAAP (Generally accepted Accounting Principle ) Grounds Rules of Accounting Cycle These Rules allow all the organization to make a same unique format these are near about 7 to 8 the let us talk about GAAP Step by step

What is accounting Principles ?

1. Entities Principle.

Specific Business entity separate from personal affairs of owner's

2. Cost Principle

Valuation and recording of Organization assets at cost value not on the current situation value.

3. Going Concern assumption.

Connected with cost principle that mean asset acquired for long time use not for resale.

4. Objectivity Principle.

Those define the Factual basis for assets valuation measuring transactions objectively.

5. Stable Currency Principle.

It is assume the value of money will be stable but in real life it dose not pertain

6. Adequate disclosure concept.

Financial statements must provide all facts necessary for proper interpretation of statements all information must be disclosed in financial matters in statements.