this is accounting subject ( principle of auditing ) please show me the steps of the solutions. 1)...

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Accounting

this is accounting subject ( principle of auditing)
please show me the steps of the solutions.
1) conservation concept emphasizes that profit shouldnever be overstated or anticipated.
True or false and why?
2) evaluation of the closing inventory at its cost ormarket value whichever is lower is an application of the "costconcept".
True or false and why?
3) explain - briefly the following terms:
business entity - going concern - accruals - materiality- conservatism

Answer & Explanation Solved by verified expert

3.9 Ratings (713 Votes)

1 True Conservatism concept states that business entities must provide for all anticipated losses in the books of accounts but must not disclose any anticipated profits in the books This accounting concept is now known as prudence In recroding assets one should be conservative on the other hand while recording of liabilities one may not be conservative in approach See Answer

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this is accounting subject ( principle of auditing)please show me the steps of the solutions.1) conservation concept emphasizes that profit shouldnever be overstated or anticipated.True or false and why?2) evaluation of the closing inventory at its cost ormarket value whichever is lower is an application of the "costconcept".True or false and why?3) explain - briefly the following terms:business entity - going concern - accruals - materiality- conservatism