It is often difficult to see the relevance of theoretical study. This is especially so in an extremely pragmatic discipline like accounting and in an extremely pragmatic course like this. It makes it easier to identify strengths and weaknesses of alternative accounting methods.
Easier Theories are generalisations about the way the world behaves.
Accounting theories are generalisations about the way the accounting world behaves. For example, the theory of gravity states that any object allowed to fall in the earth s gravity at sea level will accelerate at 9.8 metres per second per second. This is a generalisation. We do not have to remember different rules for each object that may be allowed to fall. With this generalisation, we do not have to remember measurement rules for every type of asset.