Question

Which of following is not limitations of accounting, mcq type

Answer 1

based on accounting convention

Answer 2

"Evidence in legal matters" is not a limitation of accounting.

• Accounting is significant for any business as it helps any organization to keep records of its financial activities, analyze the situation of profit and loss, and act as a guide to the organization's vital information that is helpful for outsiders as well as management.
• However, accounting comes with limitations too. Like it is based on certain conventions and is prone to omission, mistakes, forgeries, and may leave out qualitative information.
• "Evidence in legal matters" is not a limitation of accounting because the financial records of an organization can be used as prepared evidence in the court of law by supporting the organization's claims.

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Complete question:- Which of the following is not a limitation of accounting:

1) based on accounting conventions

2) evidence in legal matters

3) incomplete information

4) omission of qualitative information