The Four Main Accounting Principles for Financial Reporting Established in SSAP

question 21

Multiple Choice

The four main accounting principles for Financial Reporting established in SSAP 2 "Accounting Concepts" (1971) are:

• A) Going Concern, Accruals, Consistency and Prudence
• B) Relevance, Reliability, Comparability and Understandability
• C) Going Concern, Relevance, Consistency and Comparability
• D) Accruals, Prudence, Reliability and Understandability

---

Definitions:

Marginal Tax Rate

The percentage of tax applied to an individual or entity's next dollar of income, showing the impact of the last dollar earned on their tax liability.

Taxable Income

The amount of an individual’s or a company's income used to determine how much tax they owe the government in a given tax year.

Cash Flow

This term refers to the net amount of cash and cash-equivalents being transferred into and out of a business.

Assets

Items of value owned by a person or company, encompassing both tangible and intangible items that can be used to produce positive economic value.