The next concept that will be looking at is called the periodicity assumption

Earlier, I told you that accountants usually assumed that the business will continue to exist in the unforeseen future.

However, the periodicity concept states that this indefinite period of existence should be divided into periods, called the accounting year, for the preparation of financial statements.

What this concept is basically saying is this: accountants should prepare financial statements every accounting year.

An accounting year is usually a 12-month period. However, due to the need for more transparency and accountability, companies are now preparing financial statement quarterly, bianually

The money measurement concept.

This holds that only transaction which has monetary significance should be recorded in the books of account.

So, just because, anything affects a business does not mean it should be recorded in the books of account, rather, it must have monetary significance

Daniel, for example, bought 100 books. This would not be recorded in the book since it was not expressed in terms of money. Ok, if Daniel bought the 100 books for $1600. Then, we would record it in the book since it is now expressed in terms of money.

This explains why facts like honesty and dedication of employees are not recorded even though they affect the company profits.

It should, however, be noted that the financial statement of a firm operating in a hyperinflationary economy should be restated to account for the change in the general purchasing power of the currency(IAS 29)

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It's time for today's discussion. Before we proceed, pls note that you can now join our Whatsapp community: https://chat.whatsapp.com/JXHPrOnCRW89X9NJAIE9D7

Demand can be defined as the quantity of goods and services that a consumer is willing and able to buy.

For demand to be effective, it must be backed by ,the willingness and ability to buy.

If any of these two is absent, then, it is considered mere want

So, we can say demand not backed by ability and willingness to pay is want

The specific unit(s) of good that a consumer is willing to pay is called quantity demanded while the amount for this unit is called price.

Often, a rise in price leads to a decrease in quantity demanded and a fall in price lead to an increase in quantity demanded. This is so obvious that it had now come to be called the law of demand.

The price and quantity demanded pairings can be represented on a table. Economist called this table demand schedule.

At the risk of oversimplifying, the demand schedule is the tabular representation of the number of goods that consumer will buy at different prices.

Here is an example 👇👇👇

The price and quantity demanded pairings can also be illustrated on a graph. This graph is called the demand curve. Here is an example of a demand curv

In economics, the change in quantity demanded is not the same as the change in demand.

When economists talked about the change in quantity demanded, They mean quantity changes caused by changes in the good's price.

The above demand curve illustrates this. As price rises, we saw a movement along the same demand curve.

When economists talked about the change in demand, They mean a change in demand caused by non-price factors like income, fashion.

As you will be seen below, this usually leads to a shift in the demand curve.

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You might be asking: How does income, price of related goods, fashion affect demand? Want to get the answer? You can read this: http://www.eathyreading.website/2020/09/demand.html

That is all for now 👋. But before you go,

SPECIAL ANNOUNCEMENT

We will be learning how to solve this question on elasticity of demand by 12:00PM

Date: March 9, 2021

Due to some personal issues. We are sorry to announce that today's class has been delayed by 4 hours.

In effect, we will be starting from 4:00 pm to 4:30 pm.

Thanks for your understanding.

Ok, let solve this