GAAP is an acronym for Generally Accepted Accounting Principles
U.S. GAAP is formulated by the Financial Accounting Standards Board (FASB)
FASB’s Conceptual Framework states that accounting should be:
A business is separate from its owners
Accounting is based on objective evidence
The most commonly used measurements are based on historical cost and fair value.
Business will continue indefinitely
Transactions are recorded in a stable currency ($)