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प्रश्न
According to this principle, record all anticipated losses but ignore all anticipated gains. Industry practice.
विकल्प
Materiality
Consistency
Conservatism
Timeliness
उत्तर
Conservatism
Explanation:
The conservatism principle (also known as the principle of prudence) suggests that accountants should record all anticipated losses but not anticipate any gains when preparing financial statements. This principle encourages caution in reporting and ensures that assets and income are not overstated, while liabilities and expenses are not understated.
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संबंधित प्रश्न
This principle states that accounting procedures and methods should remain consistent from one year to another.
This principle is an exception to the principle of full disclosure.
Closing stock is always valued at market price. Justify for or against by citing two reasons.
Explain the principle of materiality.
Explain the principle of Timeliness.
"Principle of consistency is a modifying principle." Comment.
Name and explain the accounting convention which says record all anticipated losses but ignore all anticipated gains.
Explain the Principle of Prudence.
Explain the principle of industry practice.
Explain the accounting conventions.
