This accounting equation states that the assets of a business are always equal to claims of owner/owners and outsiders. The knowledge of dual aspect helps in identifying two aspects of a transaction which helps in applying rules of recording transactions in books of accounts.
Significance of Dual aspect concept
Concept helps accountant in detecting error.
It encourages accountant to post each entry in opposite sides of two affected accounts.
Revenue from any business transaction should be included in accounting records only when it is realized, according to realization concept. The term
Realization means creation of legal right to receive money.
Significance of Realization concept
It helps in making the accounting information more objective.
It provides that the transactions should be recorded only when goods are delivered to buyer.