During the lifetime of an entity, accountants produce financial statements at arbitrary points in time in accordance with which basic accounting concept?
A) Cost constraint
B) Periodicity assumption
C) Conservation
D) Expense recognition principle

Question

Quizplus · Accepted Answer

The periodicity assumption requires accountants to split the life of an entity into arbitrary periods of time (e.g. months, quarters, years) and produce financial statements at the end of each period. This allows stakeholders to track the financial performance of the entity over time and make informed decisions.

During the Lifetime of an Entity, Accountants Produce Financial Statements