P $1-5$ Certain underlying considerations have had an important impact on the development of generally accepted accounting principles $.$ Following is a list of these underlying considera$-$ tions $,$ as well as a list of statements describing them $.$ a$.$ Going concern or continuity b$.$ Monetary unit $.$ Conservatism d$.$ Matching e$.$ Full disclosure f$.$ Materiality g$.$ Transaction approach h$.$ Accrual basis i$.$ Industry practices Verifiability k$.$ Consistency Realization m$.$ Historical cost n$.$ Time period $.$ Business entity $1.$ The business for which the financial statements are prepared is separate and distinct from the owners $.2.$ The assumption is made that the entity will remain in business for an indefinite period of time$\mathrm{.}3.$ Accountants need some standard of measure to bring financial transactions together in a meaningful way $.4.$ Revenue should be recognized when the earning process is virtually complete and the exchange value can be objectively determined $5.$ This concept deals with when to recognize the costs that are associated with the recognized revenue $.6.$ Accounting reports must disclose all facts that may influence the judgment of an informed reader $.7.$ This concept involves the relative size and importance of an item to a firm $.8.$ The accountant is required to adhere as closely as possible to verifiable data $.9.$ Some companies use accounting reports that do not conform to the general theory that underlies accounting $10.$ The accountant records only events that affect the financial position of the entity and $,$ at the same time $,$ can be reasonably determined in monetary terms $11.$ Revenue must be recognized when it is realized $($realization concept $),$ and expenses are recognized when incurred $($matching concept $12.$ The entity must give the same treatment to comparable transactions from periodto period $.13.$ The measurement with the least favorable effect on net income and financial position in the current period must be selected $.14.$ Of the various values that could be used $,$ this value has been selected because itis objective and determinable $.15.$ With this assumption $,$ inaccuracies of accounting for the entity short of its complete life span are accepted.