Accounting concepts 1. Cost concept: Assets are normally shown at cost price 2.Money measurement concept: The concept that accounting is concerned only with facts measurable in money, and for which measurement can obtain general agreement. 3. The business entity concept: Assumption that only transactions that effect firm and not the owner’s private transactions will be recorded. 4. The dual aspect concept: The concept that each transaction is recorded by taking both aspects, debit and credit. 5. Accrual concept: The concept that profit is the difference between revenue and expenditure. 6.Going concern concept: The assumption that the business will continue to operate for the foreseeable future or continue for a long time 7. Materiality concept: Recording something is a special way only if the amount is not a small one. 8. Subjectivity: Using a method that other people may not agree to derived from one’s own personal preferences. 9. Prudence: Ensuring that profit is not shown as being too high or that assets are shown at too high value. 10.Consistency: Each firm should follow constant method of treatment for each item. If the method is changing every year, then the profit calculated will be misleading one. 11. Time interval concept: Final accounts are prepared at regular intervals.