The Principle Prescribing That Financial Statements Reflect the Assumption That

question 4

Multiple Choice

The principle prescribing that financial statements reflect the assumption that the business will continue operating instead of being closed or sold,unless evidence shows that it will not continue,is the:

• A)Going-concern principle
• B)Business entity principle
• C)Objectivity principle
• D)Cost principle
• E)Monetary unit principle

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Definitions:

Regulatory Capture

A situation in which industry regulatory agencies are dominated by the industries they are charged with regulating, leading to a conflict of interest.

Industry Regulation

A set of guidelines, rules, and laws designed to control the way businesses operate in specific sectors, aiming to protect consumers, ensure fair competition, and prevent environmental damage.

Monopoly Power

The ability of a single seller to influence the price of a good or service in the market, often due to lack of competition.

Consumer Groups

Organizations or collectives that advocate for the rights and interests of consumers, often focusing on issues like product safety and fair pricing.