Which of the Following Statements Regarding the Going Concern Concept

question 31

Multiple Choice

Which of the following statements regarding the going concern concept is FALSE?

• A) Generally accepted accounting principles are based on the going-concern concept.
• B) Dealing with questions of going concern is difficult because auditors are forced to evaluate matters of financial analysis, business strategy, and financial forecasting.
• C) Management is responsible for determining whether there is a significant doubt about a company's ability to continue as a going concern.
• D) Financial difficulties, labour problems, loss of key personnel, litigation, and other such things may be important signals.

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Definitions:

Economic Growth

An increase in the capacity of an economy to produce goods and services, compared from one period of time to another.

Life Expectancy

The average number of years a person is expected to live based on demographic factors such as current age and gender, typically derived from statistical analysis.

Literacy Rate

The percentage of people within a population who are able to read and write at a specified age.

Economic Growth

An increase in the production of goods and services in an economy over a period of time, measured by changes in the gross domestic product (GDP).