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Accounting Term Definition

1. Specific identification
2. Materiality concept
3. Last-in, first-out (LIFO) a. Treats the oldest inventory purchases as the first units sold.
4. Conservatism
5. Consistency principle h. Principle that states significant items must conform to GAAP.
6. Weighted-average
7. Disclosure principle e. Principle whose foundation is to exercise caution in reporting financial statement items.
8. First-in, first-out (FIFO) f. Treats the most recent/newest purchases as the first units sold.

1 answer

Here’s a matching of the accounting terms with their definitions:

  1. Specific identification - (The process of tracking and identifying the cost of each specific item of inventory).
  2. Materiality concept - h. Principle that states significant items must conform to GAAP.
  3. Last-in, first-out (LIFO) - f. Treats the most recent/newest purchases as the first units sold.
  4. Conservatism - e. Principle whose foundation is to exercise caution in reporting financial statement items.
  5. Consistency principle - (The principle that requires a company to use the same accounting methods from year to year).
  6. Weighted-average - (An inventory valuation method where the cost of goods available for sale is divided by the number of units available).
  7. Disclosure principle - (The accounting principle that requires financial statements to disclose all relevant information).
  8. First-in, first-out (FIFO) - a. Treats the oldest inventory purchases as the first units sold.

Here is the completed matching:

  1. Specific identification - [Definition Needed]
  2. Materiality concept - h. Principle that states significant items must conform to GAAP.
  3. Last-in, first-out (LIFO) - f. Treats the most recent/newest purchases as the first units sold.
  4. Conservatism - e. Principle whose foundation is to exercise caution in reporting financial statement items.
  5. Consistency principle - [Definition Needed]
  6. Weighted-average - [Definition Needed]
  7. Disclosure principle - [Definition Needed]
  8. First-in, first-out (FIFO) - a. Treats the oldest inventory purchases as the first units sold.

Please provide definitions for Specific identification, Consistency principle, Weighted-average, and Disclosure principle for complete understanding.