The going concern concept justifies accounting practices such as depreciation.

Question

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The going concern concept assumes that a business will continue to operate for the foreseeable future. As a result, accounting practices such as depreciation can be justified because they allocate the cost of assets over the expected useful life of those assets. This is consistent with the idea that the business will continue to operate and generate revenue in the future, even if the assets being depreciated are no longer in use.

The Going Concern Concept Justifies Accounting Practices Such as Depreciation