Question

Which of the following is not a fundamental accounting assumption? (a) Going concern (b) Consistency (c) Prudence (d) Accrual

Answer 1

Answer:

A,B and D

Explanation:

There are three assumptions

1) Going concern

2) consistency

3) Accural basis

Answer 2

Answer:

Hence Prudence is not a fundamental accounting assumption.

Explanation:

Accounting assumption are the set of rules or guideline or principles which are followed while recording business transaction.

There are three basic accounting assumptions:

1. Going concern

2. Consistency

3. Accrual  

These assumptions is important for appropriate accounting of fixed assets and depreciation.

These assumption helps the entity to understand the basic fundamental of accounting which they show in their financial statement of organisation.

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