Accounting for IGCSE & O level - Advanced Principles (Section 6 - No. 36)
What is the fundamental concept underlying the 'monetary measurement principle'?
All assets must be valued in the company's functional currency.
Only transactions involving cash need to be recorded.
All financial transactions and events must be expressed in monetary terms.
Only transactions above a certain dollar amount should be recorded.
Explanation
The monetary measurement principle requires that all economic events be quantified and recorded in monetary units.
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