ECONOMICS, ACCOUNTING PRACTICE AND ACCOUNTING RESEARCH STUDY NO. 3.
The objectives of this article are to supply a specific study, and to try to show some of the hazards that must be risked by any one attempting to define accounting principles logically. For many years accountants have sought to discover and state the principles on which the practice of their profession should be based. The latest such effort which is reasonably complete is accounting research study (ARS), "A Tentative Set of Broad Accounting Principles for Business Enterprises," by Robert T. Sprouse and Maurice Moonitz. Traditionally, the accounting profession has regarded economic theory as too subjective to apply to real situations in accounting. This judgment should not be extended to include ARS, which may be regarded as an attempt to reconcile accounting practice with an internally consistent theory of income determination. Although economists often construct different definitions of income to serve the requirements of the problem with which they are dealing, the most widely quoted one would define business income as the amount which could be distributed to the business' owners at the end of a period while permitting the business after the distribution to remain in the same condition as at the beginning of the period, with equivalent expectations.
- DOI
- 10.2308/tar-4497669
- Volume
- 40 (1)
- Pages
- 82-88
- Language
- en
- Export
- BibTeX
- Sources
- openalex crossref