Question

Discuss the money measurement concept.

Answer 1

This accounting concept states that only those business activities that can be expressed in monetary terms will be recorded in accounting. Only financial transactions will find a place in accounting. Any other transaction, no matter how significant, will not find a place in the financial accounts. For example, the appointment of a manager, or creativity of its research department, or the image of the organization among people, in general, do not find a place in the accounting records of a firm.
Another important aspect of the concept of money measurement is that the records of the transactions are to be kept not in the physical units but in the monetary unit.