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) Conservatism constraint
D) Expense recognition principle

Question

Quizplus · Accepted Answer

The periodicity assumption requires that financial statements be prepared at regular intervals, such as monthly or annually, to provide useful information for decision-making. Therefore, accountants produce financial statements at arbitrary points in time in accordance with this concept. The cost constraint, conservatism constraint, and expense recognition principle are other basic accounting concepts that guide the preparation of financial statements, but they are not directly related to the timing of when the statements are produced.

During the Lifetime of an Entity, Accountants Produce Financial Statements