In Accounting, the Rule That Requires That Assets, Services, and Liabilities

question 288

Short Answer

In accounting, the rule that requires that assets, services, and liabilities be recorded initially at the cash or cash-equivalent value of what was given up or of the item received is called the ________.

Understand the reasons and accounting treatment for repurchasing shares.

Recognize the accounting treatments for non-cash considerations in share transactions.

Comprehend the concept of dividends in arrears and their reporting implications.

Understand the effects of stock splits and stock dividends on retained earnings and equity structure.

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Definitions:

Chips

Thin slices of vegetables, fruits, or other foods, fried or baked until crisp, often consumed as a snack.

Trade

The exchange of goods or services between entities or individuals.

Premack Principle

The Premack Principle is a psychological principle which suggests that more probable behaviors will reinforce less probable behaviors, meaning that if a person wants to perform a specific activity, they will perform a less desirable activity to get to it.

Decrease

A reduction in quantity, size, or intensity of an object or an action.