The four basic assumptions that underline the financial accounting structure comprise of: An economic entity assumption, a going concern assumption, a monetary unit assumption as well as a periodicity assumptions.
Work Step by Step
Normally, the accounting concepts are usually operational guidelines that are developed so as to assist the accounting of various transactions that normally take place in an enterprise. In addition, these concepts guide in developing rational responses to complicated issues related to issues of financial accounting and reporting. This is to say that the basic assumptions underlying financial accounting helps in coming up with the framework of accounting within an organization and a structural form.