If a business is not being sold or closed, the amounts reported in the accounts for assetsused in operations are based on costs. This practice is justified by the:
A)Cost principle.
B)Going concern principle.
C)Revenue recognition principle.
D)Monetary unit principle.
E)Business entity principle.

Question

Quizplus · Accepted Answer

The going concern principle assumes that a business will continue to operate indefinitely, justifying the use of historical cost for asset valuation rather than liquidation value.

If a Business Is Not Being Sold or Closed, the Amounts