Question 1 Introduction
The going concern concept presumes that the business for which the accounts are being prepared will continue to trade for the forseeable future.
Accounting concepts are principles of accounting which underlie the preparation of financial statements and apply to all types of business organisation.
The materiality concept requires the accurate recording of the value of all items of inventory held by a business.
The business entity concept requires that the personal assets and liabilities of a sole trader are added to business assets and liabilities in the financial statements.
The accounting concept of cost requires that all assets are valued in the statement of financial position at original cost, regardless of their present value.
The going concern concept presumes that the business for which the accounts are being prepared will continue to trade for the forseeable future.
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