1. Accounting Principles and Reporting Standards FLASHCARDS

2. Historical cost principle The principle that requires assets to be recorded at their cost at the time they are acquired Historical cost principle

3. Periodicity of income assumption The concept that income should be reported in certain time periods Periodicity of income assumption

4. Qualitative characteristics Traits necessary for credible financial statements: usefulness, relevance, reliability, verifiability, neutrality, understandability, timeliness, comparability, and completeness Qualitative characteristics

5. Recognition The determination of the period in which to record a business transaction Recognition

6. Separate entity assumption The concept that a business is separate from its owners; the concept of keeping a firm's financial records separate from the owner's personal financial records Separate entity assumption

7. For additional reinforcement of accounting terms, visit the crossword puzzle on this Web site.