The principle prescribing that financial statements reflect the assumption that the business will continue operating instead of being closed or sold,unless evidence shows that it will not continue is the:
A)Going-concern principle
B)Business entity principle
C)Objectivity principle
D)Cost Principle
E)Monetary unit principle

Question

Quizplus · Accepted Answer

The Going-concern principle prescribes that financial statements should be prepared with the assumption that the business will continue to operate instead of being closed or sold, unless there is evidence that it will not continue. This principle is important because it helps users of financial statements, such as investors and creditors, to make informed decisions about the future prospects of the business.

The Principle Prescribing That Financial Statements Reflect the Assumption That