Accounting Method Options: INCORRECT OR CORRECT

PRINCIPLE ASSUMPTION: MONETARY UNIT ASSUMPTION, ECONOMIC ENTITY ASSUMPTION OR HISTORICAL COST PRINCIPAL

Question 1 The following situations involve accounting principles and assumptions. For each of the three situations, say if the accounting method used is correct or incorrect. If correct, identify which principle or assumption supports the method used. If incorrect, identify which principle or assumption has been violated Accounting method Principle/Assumption 1. Tisinai Company owns buildings that are worth substantially more than they originally cost. In an effort to provide more relevant information, Tisinai reports the buildings at fair value in its accounting reports. 2. Kingston Company includes in its accounting records only transaction data that can be expressed in terms of money. 3. Roger Holloway, owner of Roger's Photography, records his personal living costs as expenses of the business