The accounting convention that state that, stock should be value that the lower of cost...
FINANCIAL
JAMB 2015
The accounting convention that state that, stock should be value that the lower of cost and net realized value is --------------- convention
- A. marching
- B. consistency
- C. realization
- D. prudency
Correct Answer: D. prudency
Explanation
Prudence Concept or Conservatism principle is a key accounting principle which makes sure that assets and income are not overstated and provision is made for all known expenses and losses whether the amount is known for certain or just an estimation i.e expenses and liabilities are not understated in the books of account
Post an Explanation Or Report an Error
If you see any wrong question or answer, please leave a comment below and we'll take a look. If you doubt why the selected answer is correct or need additional more details? Please drop a comment or Contact us directly. Your email address will not be published. Required fields are marked *