A.

MEASURED CONSIDERATION

the amount of rupiah / aggregate price (measured consideration) involved in each transaction or
exchange activity is the most objective basic subject matter for accounting, especially in measuring
economic sources that come in (income) and economic sources that come out (costs).

Or in simpler way, The accounting must record the transaction at an aggregate price (measured
consideration) because it is the represent the value that agreed by the buyer and seller at a certain time

in business activities, the company will definitely do an exchange transaction with another company,
and accounting seeks to express this exchange quantitatively. Therefore, the basic subjects of
accounting are the measurable considerations involved in exchange activities, especially those related to
services obtained (costs, fees) and services provided (revenue, income).

it is certain that accounting is not limited to bare recording, it also involves periodic reporting for the
purpose of facilitating administration. Therefore, this concept is similar to historical cost principal.

according to stephen zeff in his journal. In the measured consideration section, Littleton exerts a
significant influence on this part of the paper. this can be seen from the various terms written in this
book, you can find the similarities in Littleton's previous writings

1. ‘‘[t]he term ‘measured consideration’ is more appropriate than the word ‘value’ to
indicate the type of information which makes up the subject matter of accounting. It is
confusing to say that accounting records ‘values’’’ (P&L 1940, 12)
= Littleton (1929, Value and price in accounting. The Accounting Review 4- 153) had earlier written,
‘‘[a]ccounting is a record function, not a valuation function. . .for values are too momentary and
too subjective to be clothed in figures.’’
Littleton (1928, What is profit? The Accounting Review 3 -287) emphasized that value ‘‘can never be the
starting point of a calculation of profit.’’

2. ‘‘[t]he consideration or price-aggregate of an exchange may express the mutual valuation

of the buyer and seller as of the moment of exchange and, in this limited sense and as of
that moment, a record of such price-aggregate may be viewed as a record of value’’ (P&L
1940, 12)
= This was pure Littleton, whose earlier writings referred variously to ‘‘money outlays,’’
‘‘money prices,’’ ‘‘bargained prices,’’ and ‘‘two price streams’’ (Littleton 1936a, 1937a,
1938a, 1938c). ‘‘Bargained prices’’ was used frequently in the monograph.
 The term ‘‘price-aggregate’’ may be traced to Littleton (1938c, The relation of function to principles.

The Accounting Review 13- 237); it was more generic than ‘‘cost,’’ because it could apply as well
to the price of revenue.

3. The coauthors said that recorded price-aggregates were ‘‘the best means available for
representing varied transactions in homogeneous terms’’ (P&L 1940, 12).
= Littleton, in his earlier writings (Littleton 1936a, 11–12, 15; 1937a, 17; 1937b, 58), frequently
seized on the term ‘‘homogeneous’’ in relation to the accounting data.

4. The coauthors also cautioned that neither money nor price was significant. Instead:
‘‘‘Service’ is the significant element behind the accounts, that is, service-potentialities,
which, when exchanged, bring still other service potentialities into the enterprise’’ (P&L
1940, 13).
= The term ‘‘service-potentiality’’ may be traced to Littleton (1936a, 11). He also referred to
‘‘service-inputs’’ and ‘‘service-outputs’’ (Littleton 1937a, 17) and to ‘‘service acquired’’ and
‘‘service rendered’’ (Littleton 1939a, 59).

B. COST ATTACH

THE CONCEPT OF COSTS MORE EXPLAINS THAT costs are attached to the object they represent, so costs
are mobile and can be broken up or recombined to follow the object being approached.

if various components are combined into a new object or item, the new combined cost is simply the
combination of various costs attached to each component without regard to the new economic value
attached to the new item.

For example, in making clothes, we certainly need various other costs such as costs for labor, fabric,
yarn, buttons, and needles and to determine the price of these sales clothes we can simply combine the
prices of the objects we join to make these clothes. (joint cost)

various costs have a binding/cohesion power between one another (if one cost leave (removed), the
other one will follow) for example, in clothes company, the manager decide to eliminate the sequins in
clothes production, then they also eliminate the labor costs for sewing sequins and yarn costs.

C. EFFORT AND ACCOMPLISHMENT

This concept states that costs are efforts to obtain accomplishment in the form of revenues.
Conceptually, revenues arises because costs. not the opposite, revenues bears costs. This
means that revenues can be recognized even though it has not been realized due to cost or
efforts of the entity in carrying out its productive activities.

the amount of rupiah calculated in the purchase of goods and services is used to measure
efforts to obtain results (accomplishment). And the amount of rupiah calculated in the sale of
goods and services is used to measure the results (accomplishment) obtained ,

so, the main problem of accounting is to compare costs (as a representation of effort) and
revenues (as representations of accomplishment) as a reading of guessing tools to determine
the effect of the sacrificed effort on the results .

For example a company conducts research to increase sales and of course in the research costs
are needed and if the research is successful then the costs the company spends will not be in
vain and will instead increase the company's revenue.