The Rule That Requires Financial Statements to Reflect the Assumption

question 2

Multiple Choice

The rule that requires financial statements to 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 assumption.
• B) Business entity assumption.
• C) Objectivity principle.
• D) Cost Principle.
• E) Monetary unit assumption.

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Definitions:

Goal Statement

A clear and specific declaration of the objectives an individual or organization aims to achieve.

Time Bound

Restricted or limited by a predetermined timeframe for completion.

Measurable

Pertains to something that can be quantitatively assessed or evaluated.

Ethical Decision

A choice made based on moral principles and values, often considering the impact on all stakeholders involved.