1
Question
Match List-I with List-II and select the correct answer using the codes given the lists.
List-I(Accounting concept) List-II(Principle involved) I. Consistency (a) Losses are anticipated and accounted for in advance but profits are not accounted for until realised II. Comparability (b) All the relevant financial information should be summarised and presented in the accounting statements III. Conservatism (c) According procedures in an entity should be followed uniformly from period to period IV. Disclosure (d) Accounting statement of different periods of an entity and those of different entities of a period should be based on the same accounting principles and procedures (e) Personal Judgement of accountants should not influence accounting measurements
Match List-I with List-II and select the correct answer using the codes given the lists.
| List-I(Accounting concept) | List-II(Principle involved) |
| I. Consistency | (a) Losses are anticipated and accounted for in advance but profits are not accounted for until realised |
| II. Comparability | (b) All the relevant financial information should be summarised and presented in the accounting statements |
| III. Conservatism | (c) According procedures in an entity should be followed uniformly from period to period |
| IV. Disclosure | (d) Accounting statement of different periods of an entity and those of different entities of a period should be based on the same accounting principles and procedures |
| (e) Personal Judgement of accountants should not influence accounting measurements |
Open in App
Solution
The correct option is B I-(c), II-(d), III-(a), IV-(b)
1. Consistency: The consistency principle states that, once you adopt an accounting principle or method, continue to follow it consistently in future accounting periods. Only change an accounting principle or method if the new version in some way improves reported financial results. 2. Comparability: It is one of the key qualities which accounting information must possess. Accounting information is comparable when accounting standards and polices are applied consistently from one period to another and from one region to another.3. Conservatism: Under the conservatism principle, if there is uncertainty about incurring a loss, you should tend towards recording the loss. Conversely, if there is uncertainty about recording a gain you should not record the gain.4. Disclosure: Full disclosure principle requires a company to provide the necessary information so that people who are accustomed to reading financial information can make informed decisions concerning the company. All relevant financial information should be summarised and presented in the accounting statements.
1. Consistency: The consistency principle states that, once you adopt an accounting principle or method, continue to follow it consistently in future accounting periods. Only change an accounting principle or method if the new version in some way improves reported financial results.
2. Comparability: It is one of the key qualities which accounting information must possess. Accounting information is comparable when accounting standards and polices are applied consistently from one period to another and from one region to another.
3. Conservatism: Under the conservatism principle, if there is uncertainty about incurring a loss, you should tend towards recording the loss. Conversely, if there is uncertainty about recording a gain you should not record the gain.
4. Disclosure: Full disclosure principle requires a company to provide the necessary information so that people who are accustomed to reading financial information can make informed decisions concerning the company. All relevant financial information should be summarised and presented in the accounting statements.
Suggest Corrections
0
Similar questions
View More
Join BYJU'S Learning Program
Explore more
Join BYJU'S Learning Program
