Types of Concepts

7- the matching concept

Is a simple and effective concept, it is realated to the accrual concept, it all about compairing the revenue of an itam has been sold to it is original expenses. However we also can it is the principle that requires a company to match expenses with recenues in order to report a company’s profites during the same period of time. For example a shop selling burgers, you should count the expenses of burgers which have been sold that day and compare it with the revenue, so in the end of the day we can say if the expenses are more than the revenue we call it (loss) but if the revenue is more than the expenses we call it (profit)

8- the dual aspect concept

It is the basic principle of accounting; this concept assumes that every transaction has a dual effects, that is why the transactions should be recorded in two different places. For instant good which have been sold for cash has two aspects, let’s say we bought books from Singapore so we will record this as giving cash and the other aspect is to receive the books and that is where we write them in the other book, for this we can say that Assets = Liabilities + Capital, other examples for this concept is purchase of shoe factory by cheque, the two aspects in the transaction are reduction in bank balance and the other aspect is owning the factory.

9- time interval concept

It is the concept where the business should give a report about the financial results about the business progress, but that should be done under a certain period of time such as, monthly, quarterly, or annually. The accountant should fallow time period that the business has established it is date earlier to do their financial reports. For example a company which has established a business and they management decided to make the financial report every six months, so the accountant will