Which of the following statements is true?
A)Going Concern Concept assumes that business will be carried on for a definite period
B)The Capital Losses need not be deducted to ascertain net income
C)Provision for bad and doubtful debts is created in recognition of conservatism concept
D)Materiality concept states that all business transactions are to be recorded however insignificant they may be

Question

Quizplus · Accepted Answer

The Provision for bad and doubtful debts is indeed created in recognition of the conservatism concept, which advises prudence in accounting, ensuring that potential losses are recognized as soon as they are foreseen.

Which of the Following Statements Is True