Components of Money Measurement Concept
Money measurement concept records only quantitative terms and not qualitative ones. Money measurement concept tells businesses to cover only those transactions that can be expressed in terms of money (quantitative transactions) like, cash sales, cash purchases, assets sold for cash or on credit, salaries, rent, shares, etc. Transactions that can not be expressed in terms of money (qualitative transactions) like employee skill level, product durability, the efficiency of administrative processes, etc. never get recorded in the financial system and thus in financial statements.
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