During the lifetime of an entity accounting produce financial statements in accordance with, which basic accounting concept?
The correct option is A
Accounting period refers to the span of time at the end of which the financial
statements of an enterprise are prepared, to know whether it has earned profits or
incurred losses during that period and what exactly is the position of its assets and
liabilities at the end of that period.
Such information is required by different users
at regular interval for various purposes, as no firm can wait for long to know its
financial results as various decisions are to be taken at regular intervals on the
basis of such information.
The Companies Act 1956 and the Income Tax Act require that the income
statements should be prepared annually.
Principles and Practice of Accounting