Question

=) The Factory workers of XYZ Ltd. Went on a labour strike as a
result the production had to stop for a weak. The owner
estimated the loss of production and the likely loss of promote
to this situation and accordingtly directed his accountant to
book a loss in the accounts. The accountant did the same was
the accountant correct in re ording the likely loss? Give suitable
reasons in support of your answer.​

Answer 1

Answer:

No, what the accountant did is wrong, and what the owner asked the accountant to do is also completely wrong due to the fact that an accountant's job is to monitor and record monetary transactions in a business. But, here that's not what's happening.

Explanation:

The reason on why what the accountant did is incorrect is because of the fact that accounting is a process of recording monetary transactions that have taken place or will take place in a business.

A strike caused by the employees in the business can not be measured generally or in any monetary value, therefore showing it as a monitory loss is unethical and is against the entire objective rule of accounting called the "money measurement concept". Therefore making what the accountant did wrong.