Monetary Unit Assumption

Accounting Dictionary

Monetary Unit Assumption

It means that in the United States we use the dollar as our unit of measure.

In some countries the buying power of the currency fluctuates so widely that financial statements must account for the inflation and devaluation of currency. We don’t do that in the United States. We call that the Monetary Unit Assumption, the assumption that our monetary unit, the dollar, will have a relatively stable value.

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