The Concept That a Business Has a Reasonable Expectation of Remaining

question 25

Multiple Choice

The concept that a business has a reasonable expectation of remaining in business for the foreseeable future is called the

• A)economic entity assumption.
• B)monetary unit assumption.
• C)periodicity assumption.
• D)going concern assumption.

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Definitions:

Percentage-of-Completion

A method of revenue recognition in accounting where revenue and expenses are recognized as a project progresses, based on the percentage of work completed.

Revenue Recognition

The accounting principle that dictates the process and timing by which revenue is recorded and recognized as income on the financial statements.

Specific Industry Guidance

Regulations and recommendations tailored to the operating practices and challenges of particular sectors.

GAAP

Short for Generally Accepted Accounting Principles, a set of rules and standards designed to ensure consistency in financial reporting.