The Income Concept- Value Increment or Earnings Predictor.

Abstract This article focuses on the income concept, which deals with many major accounting problems. The main focus is on two general concepts, income as an increment in value and income as a predictor of earnings. These may be useful in resolving some problems of income measurement. An understanding of these two concepts may also be helpful in deciding questions of presentation of financial position. The theories underlying income measurement and financial position presentations are, of course, completely intertwined. In practice, the measurements of income and financial position are also fled together, but not always in a beneficial manner. Too frequently the accountant approaches a transaction and chooses the method for recording it that better measures income or better measures the financial position of a corporation. In this paper the author will develop a means of evaluating different ways of recording transactions, without compromising on the quality of either the measure of income or financial position.