Open AccessThe Convergence Of Economic And Accounting Concepts Of Income
Author(s) -
James A. Fellows
Publication year - 2011
Publication title -
journal of applied business research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.149
H-Index - 22
eISSN - 2157-8834
pISSN - 0892-7626
DOI - 10.19030/jabr.v5i2.6354
Subject(s) - net income , divergence (linguistics) , comprehensive income , economics , measure (data warehouse) , net national income , accounting , convergence (economics) , realization (probability) , gross income , public economics , macroeconomics , computer science , mathematics , linguistics , philosophy , statistics , tax reform , database , state income tax
One of the most disputed areas of contention between professional accountants and economic theorists is the divergence between their respective definitions of income. Generally, an economist views any accretion to net worth as income, while the accountant defines income to include only those increases in net worth that result from a realization event, i.e., a sale or exchange. Recently, however, the professional accounting community has begun an attempt to redefine its own measure of income. The following article reviews the controversy, as well as analyzing the struggle for a new measure of accounting income.