Answer
The four rudimentary assumptions in the financial accounting structure include:
-A monetary unit consumption
-An economic entity assumption
-A periodic assumption
-A going concern assumption
Work Step by Step
In the monetary unit principle, money is treated as a unit of measurement with the value of the currency assumed to remain constant, therefore maintaining its purchasing power. The economic entity assumption allows a type of organization or society to be considered as an economic entity. The periodic assumption allows an accountant to divide financial computations into different periods of the year; for instance, quarterly, monthly etc. The going concern assumption, on the other hand, enables the assumption that a business entity will continues to carry out its operations in the foreseeable future.
