meaning of going concern concept
Answers
Answer:
The concept of going concern assumes that a business firm would continue and carry out its operations for a foreseeable future. ... Because of this difference between capital expenditure (gives long term benefit to the business) and revenue expenditure (its benefit is taken in the same accounting year) is made.
Explanation:
A going concern is a business that is assumed will meet its financial obligations when they fall due. It functions without the threat of liquidation for the foreseeable future, which is usually regarded as at least the next 12 months or the specified accounting period.
Going concern is an accounting term for a company that is financially stable enough to meet its obligations and continue its business for the foreseeable future. Certain expenses and assets may be deferred in financial reports if a company is assumed to be a going concern.