Question

Alex is the purchase assistant. He bought a hard drive for the company. The accountant asked for a receipt as proof of purchase. What accounting principle is the accountant complying with. a. realization b. objectivity c. mathing d. consistency e. duality

Answer 1

Note that accounting principles are the accounting policies and methods of applying those policies.

In preparing financial statements various alternatives can be used to present a particular item in order to bring uniformity in the treatment and ensure compatibility and consistency of financial statement accounting principles are developed

Alex is purchase assistant who bought a hard drive for the company and accountant is asking receipt of such purchase as a proof of purchase is the example of objectivity principle.

Objectivity principle is the accounting concept as per which an organization's financial statements should be prepared and presented on on the basis of solid evidences and financials of an organization should not be based merely upon opinions and biaseness of someone.

Later on auditor of the company will express his opinion on whether financial statements are showing true and fair view on the basis of these evidences only.

Therefore, in the present case accountant by asking proof of purchase of hard disk is complying with objectivity principle.